Report: Qatar Investment Authority Buys Stake in Wizards, Capitals' Parent Company

The Qatar Investment Authority is reportedly buying a minority stake in Monumental Sports & Entertainment, which owns the NBA's Washington Wizards, NHL's Washington Capitals and WNBA's Washington Mystics.

Scott Soshnick and Eben Novy-Williams of Sportico reported the QIA will purchase 5 percent of the conglomerate. The deal puts a $4.05 billion valuation on the Monumental Sports properties.

Monumental also owns the TV network Monumental Sports Network (formerly known as NBC Sports Washington).

NBA rules dictate no sovereign wealth funds can own more than 20 percent of a franchise. The QIA is limited to purchasing what's known as a "passive" stake in the franchise.

The QIA will not receive a board seat or hold any operational power within the organization. Majority owner Ted Leonsis will retain final decision-making power on all matters related to the teams and other properties.

Overseas investment funds have become increasingly involved in American professional sports in recent years. Saudi Arabia's Public Investment Fund (PIF) founded LIV Golf and recently came to an agreement with the PGA Tour on a merger of the two golf leagues. The PIF will serve as the primary financial investor of the yet-to-be-named league, which has faced antitrust pushback from legislators.

WWE also has a longstanding agreement with Saudi Arabia to hold premium live events in the country.

The NBA approved private equity funds joining ownership groups in 2020. The NHL, MLB and MLS soon followed suit.

The NFL still prohibits state-funded investors for its teams.