Saudi Arabia plans to invest 142 billion riyals ($38 billion) to turn the kingdom into a hub for e-sports by 2030. This is part of the country's plans to diversify its economy and reduce its dependence on oil.
The Savvy Games Group, a subsidiary of the sovereign wealth fund, will invest 50 billion riyals in acquiring and developing a games publisher, and 70 billion riyals in taking minority stakes in gaming companies, according to a statement.
The Saudi government will invest 20 billion riyals in established gaming companies, and an additional 2 billion riyals in early-stage gaming and e-sports businesses. This represents a significant commitment to the gaming industry, and will help spur further growth in this rapidly-expanding sector.
"The esports and games sector has untapped potential that we can harness to diversify our economy, drive innovation in the sector, and offer more entertainment and esports competition opportunities across the kingdom," said Saudi Crown Prince and Chairman of Savvy, Mohammed Bin Salman.
Saudi Arabia is already becoming an active investor in the e-gaming industry. Its Public Investment Fund has built up stakes in Activision Blizzard Inc., Electronic Arts Inc. and Nintendo Co. This is a significant shift for the country, which has historically been wary of investing in the gaming industry. However, with the rise of mobile and online gaming, Saudi Arabia is recognizing the potential for growth in this sector.
Savvy has bought a stake in Embracer Group AB and acquired the e-sports division of Modern Times Group at an enterprise value of $1.05 billion. Savvy's CEO, Brian Ward, is a former head of worldwide studios at Activision Blizzard.
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