The PGA Tour abruptly ended its expensive battle with Saudi Arabia’s golf venture and is now joining forces with it, making a stunning announcement Tuesday of a merger that creates a commercial operation with the Public Investment Fund and the European tour.
As part of the deal, the parties are immediately dropping all lawsuits involving LIV Golf.
From the golf side, it’s still to be determined how the players like Brooks Koepka and Dustin Johnson could rejoin the PGA Tour after stepping down last year for signing bonuses reported to be in the $150 million range.
On the commercial side, the governor of Saudi Arabia’s sovereign wealth fund has joined the PGA Tour board of directors and is leading the new business venture as chairman, although the PGA Tour will have a majority stake.
News of the deal came as a surprise to many observers of Saudi Arabia’s lawsuits and intrusions in US politics, sports and culture.
“This is a huge development and clearly elevates a world of golf, which is perhaps more tied to tradition in the past,” said Kristian Ulrichsen, a Middle East fellow at Houston’s Baker Institute.
Under Crown Prince Mohammed bin Salman, Saudi Arabia’s sovereign wealth fund has made a point of finding investments, like LIV, where it can shake up existing industries, Ulrichsen said.
“That’s kind of one of their mantras, is try to be disruptive and take over the status quo,” he said. “And in this case, it looks like they succeeded.”
The announcement comes a year after LIV Golf began. PGA Tour Commissioner Jay Monahan is at the Canadian Open that week and said directly about any player who has joined LIV or is thinking about it: “Have you ever apologized for being a member of the PGA Tour?”
Now they are partners, giving Saudi Arabia a commercial voice in golf’s premier organization.
“I acknowledge everything I said in the past. I know people will call me a hypocrite,” Monahan said in a conference call Tuesday night. “Anytime I’ve said anything, I’ve said it with the information I have, and I’ve said it to someone who’s trying to compete with our tour and our players.”
Most PGA Tour players were stunned by the surprising turnaround. It didn’t help that a news outlet broke the embargo announcement before Monahan could send a memo to the players. Most of the learnings of social media development.
“I love learning about the morning news on Twitter,” two-time major champion Collin Morikawa tweeted.
Many were not happy. Wesley Bryan tweeted“I feel betrayed, and cannot … trust anyone within the corporate structure of the PGA Tour for a very long time.”
Byeong Hun An added Twitter: “I’m guessing the liv teams were struggling to get sponsors and pga tour cannot turn down the money. Win-win for both tours but it’s a big lose for who defended the tour for last two years.”
“They go down their lane, we go down ours, and after a lot of introspection you realize that all this tension in the game is not a good thing,” Monahan said in a phone interview with The Associated Press.
“We have a responsibility to our tour and to the game, and we felt the time was right to have that conversation.”
Monahan held a player meeting at the Canadian Open, though most of the top players weren’t there. He described the meeting as “intense, certainly heated.”
And while it will likely only lead to greater golf riches, there’s still an explanation for why the tour would join a group that has tried to recruit some of the PGA Tour’s best players and is seen as the latest example of “sportswashing. . . ”
The deal has been in the works for the past seven weeks, when Monahan first met with Yasir Al-Rumayyan, governor of the Public Investment Fund. Players usually approve schedule changes and other competition matters. In this one, they were left behind.
“Nobody knew it,” Monahan said. “Our players expect us to operate in the best interests of the tour.”
Instead, he cited guidance from the corporate members of the PGA Tour board.
However, Monahan has his toughest job ahead of him.
He demanded loyalty from his players against a league accused of participating in sportswashing, an attempt by Saudi Arabia to shift focus from its human rights abuses, such as the 2018 killing of journalist Jamal Khashoggi.
Now the very group that poses this threat is the commercial partner of the PGA Tour and European tour.
“The divisiveness is over, and two years of disruption and disruption … is over and now we can concentrate on building our respective tours,” said Keith Pelley, CEO of the European tour. “And we’re building it at PIF, which is clearly focused on the game.”
Along the way, PGA Tour players also got rich. The tour raised the prize money in the elite events to $20 million, the same purse for LIV’s individual competition. The 2024 schedule has been revised for around 16 such tournaments.
“In a short period of time, I expect a lot of questions and criticism,” Monahan said. “In the long run, players who stayed on the PGA Tour will find they benefited in many ways.”
The agreement combines the Public Investment Fund’s golf-related commercial businesses and rights — including LIV Golf — on the PGA and European tours. The new entity is not named.
Al-Rumayyan will join the board of the PGA Tour, which continues to operate its tournaments. PIF will invest in commercial ventures.
“From the beginning, the whole initiative was how to grow the game of golf,” Al-Rumayyan said. “And I think what was achieved today is exactly that.”
Augusta National and the Royal & Ancient welcomed the news as it ends a bitter feud. Augusta National said the deal “represents a positive development in bringing consistency to men’s professional golf.” R&A CEO Martin Slumbers said it would help golf “move forward in a collaborative, constructive and innovative way”.
Regarding Greg Norman’s new role, Al-Rumayyan said only that Norman is the commissioner of LIV Golf and details of his future role will be announced in the coming weeks.
Monahan’s memo to the players hinted at a strong Saudi Arabian presence. He said the PIF would make a financial investment to become a “premier corporate sponsor” of the PGA Tour, the European tour and other international tours.
The PIF will initially be the exclusive investor in the new entity and will have the exclusive right to invest further, including the right of first refusal on any capital that may be invested.
Al-Rumayyan has been seen wearing a “MAGA” hat at LIV events on courses owned by former President Donald Trump.
Trump predicted in July that a merger was inevitable and said that anyone who did not sign the Saudi league would lose. He weighed Tuesday and called it an “attractive deal for the wonderful world of golf.”
Monahan said the partnership came together over the last seven weeks, with PGA Tour board member Jimmy Dunne responsible for bringing Monahan and Al-Rumayyan together. Dunne and Ed Herlihy, chairman of the board of the PGA Tour, will serve on the board of the commercial venture.
Phil Mickelson and Bryson DeChambeau are among 11 players who have filed an antitrust lawsuit against the PGA Tour last August. LIV joined as plaintiffsand the PGA Tour countersued.
The concern for the PIF is whether its leaders could be ousted, which Saudi Arabia wants to avoid. Being open to the depositions would leave the kingdom’s leaders more vulnerable to legal action, including lawsuits requiring them to disclose business deals with the United States.
A federal judge has ruled that PIF cannot claim immunity from the Foreign Service Immunity Act because of its commercial activities with LIV Golf in the US
PIF appealed the decision to the Ninth US Circuit Court of Appeals, which is likely to extend the lawsuit until 2024 if not longer.
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Associated Press writer Ellen Knickmeyer in Washington and AP Sports Writer Steve Douglas in Stockholm contributed to this report.
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