Saudi Arabia’s Hollywood Deals Grow as Backlash Fades

The kingdom is amassing stakes in the entertainment sector and power brokers are calculating that they can weather any negative PR

Saudi Arabia and its sovereign wealth fund have quietly — and in some cases not so quietly — built a multibilliondollar foothold in Hollywood, four years after much of the industry cut ties with the country in response to the murder of Washington Post columnist Jamal Khashoggi.

This time around, Saudi Arabia’s Public Investment Fund, overseen by Saudi Crown Prince Mohammed bin Salman, and other Saudi-affiliated firms appear to be betting that live entertainment, rich financial investments and sports can be the gateway to the American market. In January alone, the PIF-backed LIV Golf scored a critical U.S. broadcast TV agreement with The CW, while the government-owned Middle East broadcast giant MBC Group cut a deal with Vice Media to create Arabic-language content. Earlier, Saudi soccer team Al Nassr signed Portuguese superstar Cristiano Ronaldo for $200 million a year. And if the second edition of the Red

Sea Film Festival, held in the coastal city of Jeddah in December, was anything to go by, the country’s time in the cold in terms of its relations with Hollywood has come to a close.

Sharon Stone, Guy Ritchie, Spike Lee, Michelle Rodriguez, Henry Golding, Lucy Hale, Andrew Dominik and Scott Eastwood were among the attendees, more than enough stars to have impressed Cannes, while Searchlight’s The Banshees of Inisherin and Empire of Light, Neon’s Triangle of Sadness and MGM’s Bones and All screened there.

One film not on display was Kandahar, the Gerard Butler actioner from director

Ric Roman Waugh that in 2021 became the biggest Hollywood feature to shoot entirely in Saudi Arabia. Although the film — about an undercover CIA operative who must fight his way out of Afghanistan — might not sound like typical festival fare, THR understands that programmers had been hoping to bring the Open Road title to Jeddah to help showcase the country’s fast-rising filmmaking aspirations, but the dates didn’t work out. (Kandahar was just given a Memorial Day release date in the U.S.) As a small indicator of how the tide has turned, Butler — who produces via his G-Base banner — was one of the first Hollywood names to cancel a trip to Saudi Arabia in the aftermath of the Khashoggi murder in October 2018.

Or consider the big win for one of the country’s most high-profile U.S. efforts: LIV Golf, the PGA Tour rival fully funded by the PIF to the tune of billions of dollars. LIV has poached high-profile PGA stars like Phil Mickelson, Dustin Johnson, Brooks Koepka and Bryson DeChambeau, lured by guaranteed eight- or nine-figure paydays. The tour had only a YouTube channel available in the U.S. before it struck a Jan. 19 deal with the Nexstar-owned CW to air 14 LIV tournaments annually.

It’s a “win-win” for both the network and tour, says Guggenheim analyst Curry Baker. LIV should benefit from the national distribution and exposure the deal provides, while Nexstar gets hours of content on what is believed to be a revenue-sharing basis.

While The CW is no ESPN, CBS or NBC, it is still a national broadcast network and a major improvement for the tour.

Of course, the growing presence of

Saudi money in the entertainment industry has also drawn the attention of groups who believe the country has not accounted for the circumstances of Khashoggi’s murder.

(To note: SRMG, a publicly traded media firm in Saudi Arabia, is a minority investor in THR owner PMC.) The LIV-CW deal returned those concerns to the forefront, especially with Nexstar firmly in the news business with its local TV stations and cable channel NewsNation.

“We are deeply disappointed that a company that makes money from news like Nexstar would agree to participate in such a shameful PR stunt as LIV Golf, which is fundamentally designed to rehabilitate the Saudi reputation,” National Press Club president Jen Judson said. LIV CEO Greg Norman appeared Jan. 20 on NewsNation to respond to the controversy. Pressed by anchor Dan Abrams on whether he thought the Saudis had “learned from their mistakes,” Norman responded, “Yes, I do.”

But LIV is only a small piece of the puzzle being constructed by the PIF. Amid the pandemic years, the fund dramatically expanded its investment in the U.S., per a review of its public holdings, which were filed with the Securities and Exchange Commission. In October 2019, the PIF’s only U.S. public company investments were in Tesla and Uber. Now it has stakes in Live Nation, Amazon, Alphabet, Electronic Arts and Take-Two Interactive, among other ventures.

As one industry source tells THR, in just the past few months, it felt as if Hollywood companies that would have been concerned about a potential PR hit are “suddenly now much more open to doing deals with Saudi Arabia.”