Penske Media Silent on $200 Million Saudi Investment After Jamal Khashoggi’s Disappearance

The media company got a $200 million investment from Saudi Arabia’s Public Investment Fund in February

Last Updated: October 15, 2018 @ 7:08 PM

Penske Media Corp. declined to comment on Monday about whether it will reassess a $200 million investment by a Saudi Arabian public fund earlier this year.

Hollywood has been under mounting pressure to distance itself from the Arab kingdom in the wake of the disappearance and alleged murder of Washington Post columnist and Saudi dissident Jamal Khashoggi.

In February, Penske, which owns Hollywood trades Variety and Deadline among other publications, received  a $200 million infusion from Saudi Arabia’s Public Investment Fund.

The deal was hailed as a “significant milestone for PMC and its stakeholders” by the company at the time.

“After a decade of growth without raising any outside capital, this minority funding will further amplify our investments in existing PMC properties and provide additional resources for future acquisitions,” Lauren Utecht, vice president of communications for the company, told Penske-owned WWD in February.

Utecht did not respond to repeated requests for comment via email and phone on Monday. An email to Jay Penske, chairman and CEO of PMC, also went unanswered.

Khashoggi has been missing since entering the Saudi consulate in Istanbul on Oct. 2. Turkish authorities have accused the Saudi government of murdering Khashoggi, a prominent critic of Saudi Crown Prince, Mohammed bin Salman.

The Saudi government has insisted that Khashoggi left the consulate soon after he arrived and that he was not in its custody. But on Monday, CNN reported that the Saudis were “preparing to admit” that Khashoggi died during an interrogation gone wrong.

News of his possible murder prompted a growing number of media companies and executives to drop out of the Future Investment Initiative, a high-powered international conference scheduled to be held Oct. 23-25 in Riyadh. That includes Viacom CEO Bob Bakish, New York Times columnist and CNBC anchor Andrew Ross Sorkin, The Economist editor-in-chief Zanny Minton Beddoes and Los Angeles Times owner Patrick Soon-Shiong. Similarly, The New York Times announced it would no longer be a media partner of the event.

On Monday, WME’s parent company, Endeavor, signaled that it was preparing to withdraw from its $400 million deal with the Saudis.

An individual with knowledge of the situation told TheWrap Endeavor was in the process of pulling out of its deal, though the logistics have not been resolved.

Penske and Endeavor aren’t the only Hollywood players in business with the Saudis, though they are two of the most prominent to have recently sold major stakes to the sovereign fund. AMC, IMAX, World Wrestling Entertainment and others also have deals with the kingdom. AMC did not respond to multiple requests for comment. A rep for IMAX declined to comment.

In May, IMAX announced the signing of a multi-theater deal with Vox Cinemas, as the premium screening format planned to expand into Saudi Arabia. But a person with knowledge of the situation told TheWrap Sunday that plans to build more movie theaters in the kingdom, which have been mired in red tape, will likely be put on “pause” following Khashoggi’s disappearance.

WWE, which is due to return to Saudi Arabia on Nov. 2 for its “Crown Jewel” wrestling event, told TheWrap in statement that it’s “currently monitoring the situation.”

Khashoggi’s disappearance has cast a long shadow on the Crown Prince, who in April got the royal treatment during a Hollywood charming spree. The visit included a high-profile dinner at Rupert Murdoch’s Bel Air estate. Among attendees were Disney CEO Bob Iger, Universal’s Jeff Shell, Fox TV exec Peter Rice, and actors Morgan Freeman, Michael Douglas and Dwayne “The Rock” Johnson.

Jeremy Fuster contributed to this report.