Saudi Arabia’s sovereign wealth fund has established a new gaming firm in order to boost its position in the rapidly expanding gaming and eSports market.
The new business, dubbed Savvy Gaming Group, seeks to become the “top gaming and eSports group locally and globally, and will endeavor to further establish an integrated ecosystem for the industry,” according to the Public Investment Fund on Wednesday.
SGG is part of the PIF’s 2021-2025 plan to foster innovation in important industries such as entertainment, leisure, and sports.
The plan aims to generate “opportunity for the expansion and diversification of Saudi Arabia’s economy, in order to assist accomplish the kingdom’s Vision 2030 objectives,” according to the Saudi fund.
SGG has bought ESL Gaming, one of the largest independent e-sport firms, from Stockholm-based Modern Times Group in an all-cash transaction worth $1.05 billion as part of its ambition to improve its gaming portfolio and grow its worldwide influence in the sector.
The deal is likely to be completed in the second quarter of this year.
According to PIF, SGG has also bought e-sports platform Faceit and will merge the two firms to form a new global company for competitive gaming – ESL Faceit Group – that will play a vital role in accomplishing SGG’s aims.
“Savvy has committed to investing extensively in the games and eSports industries, as well as materially strengthening the worldwide games community,” stated SGG CEO Brian Ward.
“As new owners, we continue to be fully supportive of ESL’s and Faceit’s respective plans and leadership, as well as to drive their companies ahead to promote the future growth of competitive gaming,” he said.
With a leading digital platform for players to play and communicate, the merged company will provide an end-to-end solution that enables games to establish competitive gaming communities and ecosystems. It will also be a popular place for partners wishing to reach out to new audiences.
“Our concept draws gaming entrepreneurs from all over the world and enables founders to share information and learn from one another… We will continue to assist, develop, and build our communities, as well as be the greatest point of contact for entrepreneurs looking to accelerate their growth,” said MTG’s chief executive officer, Maria Redin.
“We are certain that Savvy is the ideal owner, who will continue to invest in the growth of ESL Faceit Group in order to nurture and excite gamers and fans throughout the world.”
According to a recent Boston Consulting Group analysis, gaming consumption in Saudi Arabia, the Arab world’s largest economy, is expected to reach $6.8 billion by 2030.
Along with eSports, the sector – a growing powerhouse with approximately three billion active participants worldwide – is poised to generate significant revenue, high-quality jobs, and various reputational benefits in the kingdom, where consumption is expected to grow at a compound annual rate of 22% through 2030 from $959 million in 2020, according to the consultancy.