By DOUG FERGUSON (AP Golf Writer)
The PGA Tour has ended its costly fight with the Saudi golf firm and is now partnering with it, making a stunning announcement on Tuesday of a merger that creates a business deal with the Public Investment Fund and the European Tour .
As part of the agreement, the parties immediately drop all lawsuits involving LIV Golf.
On the golf side, it remains to be seen how players like Brooks Koepka and Dustin Johnson can join the PGA Tour after defecting last year for signing bonuses reportedly in the $150 million range.
On the business side, the governor of Saudi Arabia’s sovereign wealth fund joins the PGA Tour’s board of directors and leads the new venture as chairman, although the PGA Tour holds a majority stake.
News of the deal came as a surprise to many observers of Saudi Arabia’s trials and forays into American politics, sports and culture.
“This is a huge development and obviously disrupts a world of golf, which was perhaps more tied to tradition in the past,” said Kristian Ulrichsen, Middle East Fellow at the Baker Institute in Houston.
Under Crown Prince Mohammed bin Salman, Saudi Arabia’s sovereign wealth fund has made it a point to seek out investments, like LIV, where it could shake up existing industries, Ulrichsen said.
“That’s sort of one of their mantras, is to try to be disruptive and embrace the status quo,” she said. “And in this case, they seem to have succeeded.”
As for PGA Tour players, most were taken aback by the shocking turnaround. It didn’t help that a media outlet broke the embargoed ad before PGA Tour commissioner Jay Monahan could issue a note to players. Most learned about development on social media.
“I love checking out the morning news on Twitter,” tweeted two-time major champion Collin Morikawa.
Many were not happy. Wesley Bryan tweeted: “I feel betrayed and will not be able to trust anyone within the corporate structure of the PGA Tour for very long.”
Byeong Hun An added on Twitter, “I guess the live teams had a hard time finding sponsors and the pga tour couldn’t refuse the money. Win-win for both tours, but that’s a big deal. loss for who has defended the tour for the past two years.
The announcement comes a year after the launch of LIV Golf. Monahan was at the Canadian Open that week and pointedly said of any player who joined LIV or thought about it, “Have you ever had to apologize for being a PGA Tour member?”
Now they are partners, giving Saudi Arabia a commercial voice in the premier golf organization.
“They were going their way, we were going ours, and after a lot of soul-searching, 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 this conversation.”
Monahan was traveling to Toronto to meet players at the Canadian Open, although most of the top players weren’t there. And while that will likely only lead to greater wealth in golf, it remained to be seen why the Tour would merge with a group that was trying to take away some of the best players on the PGA Tour and was seen as the latest example of ” sports washing”. .”
“I understand the criticisms,” Monahan said. “To me, you take the information you have at the time and make decisions in the best interest. Things have changed. It was a good time to have this conversation.
The deal had been in the works for seven weeks, when Monahan first met Yasir Al-Rumayyan, governor of the Public Investment Fund. Players generally approve schedule changes and other competitive matters. On this one, they were left out.
“Nobody had heard of it,” Monahan said. “Our players expect us to act in the best interest of the circuit.”
Instead, he cited advice from corporate members of the PGA Tour Board of Directors.
Still, Monahan has his toughest job ahead of him.
It has sought the loyalty of its players against a league accused of participating in sportwashing, an attempt by Saudi Arabia to distract from its human rights abuses, such as the 2018 murder of journalist Jamal Khashoggi.
Now, the very group that posed such a threat is now the PGA Tour’s business partner.
Along the way, PGA Tour players also got rich. The tour raised prizes at elite events to $20 million, the same purse for LIV’s individual competition. The 2024 calendar has been remodeled for around 16 tournaments like this.
“In the short term, I expect a lot of questions and criticism,” Monahan said. “In the long run, players who have stayed with the PGA Tour will see that they have benefited from it in many ways.”
The deal combines the Public Investment Fund’s golf-related business and commercial rights – including LIV Golf – with those of the PGA and European tours. The new entity has not been named.
Al-Rumayyan will join the board of directors of the PGA Tour, which continues to organize its tournaments. The PIF will invest in the commercial enterprise.
“From the beginning, the whole initiative was how to develop the game of golf,” Al-Rumayyan said. “And I think what was achieved today was exactly that.”
Augusta National and the Royal & Ancient have welcomed the news as it ends the bitter feud. Augusta National said the agreement “represents a positive development in bringing harmony to men’s professional golf.” R&A CEO Martin Slumbers said it would help golf “move forward in a collaborative, constructive and innovative way”.
As for Greg Norman’s new role, Al-Rumayyan only said that Norman is the commissioner of LIV Golf and details of his future role will be announced in the coming weeks.
Monahan’s rating to players indicated a strong Saudi presence. He said PIF would make a financial investment to become a “first corporate sponsor” of the PGA Tour, 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 a right of first refusal on any investable capital.
Al-Rumayyan has been spotted wearing a “MAGA” hat at LIV events at courses owned by former President Donald Trump.
Trump predicted last July that a merger was inevitable and said anyone who didn’t sign with the Saudi league would be a loser. He weighed in on Tuesday and called it “a glamorous contract for the wonderful world of golf”.
Monahan said the merger took place over the past seven weeks, with PGA Tour board member Jimmy Dunne tasked with bringing Monahan and Al-Rumayyan together. Dunne and Ed Herlihy, Chairman of the PGA Tour Board of Directors, will serve on the board of the business venture.
Phil Mickelson and Bryson DeChambeau were among 11 players who filed an antitrust complaint against the PGA Tour last August. LIV joined as plaintiffs and the PGA Tour counter-sued.
The PIF’s concern was whether its leaders could be overthrown, something Saudi Arabia wanted to avoid. Being open to depositions would make the kingdom’s leaders more vulnerable to legal action, including lawsuits demanding they reveal business deals to the United States.
A federal judge had ruled that the PIF could not claim immunity from the Foreign Service Immunity Act due to its business work with LIV Golf in the United States.
The PIF appealed the decision to the US Ninth Circuit Court of Appeals, which was likely to extend the trial until 2024 or even longer.
Associated Press writer Ellen Knickmeyer in Washington contributed to this report.
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