PGA Tour set to merge with rival LIV Golf

PGA Tour is set to put aside differences and has agreed on a merger with Saudi Arabia-backed rival LIV Golf.

The PGA Tour has agreed to merge with Saudi-backed breakaway tour LIV Golf. The decision comes after both tours got embroiled in extensive lawsuits regarding anti-trust claims. The merger will quash those pending litigations and help them both move forward as a larger golf body.

Both parties have already signed an agreement that is set to combine the PGA Tour’s and LIV Golf’s commercial businesses and rights into a new, yet-to-be-named for-profit company. The agreement includes DP World Tour, also known as the PGA European Tour.

The controversial LIV Golf is an extreme case of sportswashing. It is backed by the Saudi Arabia Public Investment Fund, an entity controlled by Saudi Crown Prince Mohammed bin Salman. For most of its existence, it was viewed as a threat to the existing ecosystem in the world of golf and the breakaway league was heavily opposed by the PGA Tour.

As a result, LIV Golf has been embroiled in antitrust lawsuits with the PGA Tour in the last year. The deal announced Tuesday would end all pending litigation.

The Public Investment Fund, owned and operated by the kingdom of Saudi Arabia is also ready to invest billions of new capital into the resulting entity formed after the merger.

“There is much work to do to get us from a framework agreement to a definitive agreement, but one thing is obvious: through this transformational agreement and with PIF’s collaborative investment, the immeasurable strength of the PGA Tour’s history, legacy and pro-competitive model not only remains intact, but is supercharged for the future,” he wrote in the memo. Deal talks started about seven weeks ago, he said later Tuesday.

Monahan also acknowledged the shock and anger triggered by the deal’s announcement, saying a meeting with PGA Tour players was “intense” and “heated.”

It is also yet to be determined how the golf players like Brooks Koepka and Dustin Johnson, who had defected to the LIV Golf for exorbitant sums of money, will be able to rejoin the PGA Tour this year.

“They were going down their path, we were going down ours, and after a lot of introspection you realize all this tension in the game is not a good thing. We have a responsibility to our tour and to the game, and we felt like the time was right to have that conversation,” Monahan further added.

Yasir Al-Rumayyan, the governor of Saudi Arabia’s sovereign wealth fund, will join the board of the PGA Tour, which continues to operates its tournaments. Al-Rumayyan will be chairman of the new
commercial group, with Monahan as the CEO and the PGA Tour having a majority stake in the new venture.