Golf’s PGA Tour and Saudi Arabia-backed LIV agree commercial tie-up

Golf’s US-based PGA Tour and Saudi Arabia-backed breakaway league LIV have agreed to join forces, ending a long-running dispute.

The PGA Tour and Riyadh’s Public Investment Fund said they have agreed to form a jointly managed entity for their commercial operations, and intend to settle all their pending litigation. The European Tour has also signed the agreement.

Saudi-backed LIV Golf, which has spent hundreds of millions of dollars to attract some of the top players to participate in its league, will also join the new entity.

The deal resolves a dispute between the established tours and LIV, which clashed over the future of golf in a saga that highlighted how the oil-rich empire’s billions are impacting the global game.

Saudi Arabia hosts the Formula 1 Grand Prix, and the PIF has invested heavily in football through its ownership of English Premier League side Newcastle United.

This week, the Saudi government transferred majority holdings in four Saudi football teams to the PIF, arming the fund with prime assets as it seeks to attract more players from Europe.

The Saudi-backed LIV, which launched last summer, alienated professional golf by offering hundreds of millions of dollars to attract top players. Brooks Koepka, Phil Mickelson and Dustin Johnson were among those who switched allegiance to play for the upstart tour rather than America’s incumbent.

Rory McIlroy, who once claimed LIV was “dead in the water” but later walked back those comments, was one of the highest-profile stars with the PGA, while Tiger Woods also bankrolled the Saudi tour. opposed the approach of joining.

The US PGA Tour and DP World Tour immediately banned any player from joining LIV, which also came under fire for Saudi Arabia’s poor record on human rights and the 2018 murder of journalist Jamal Khashoggi by Saudi agents .

The new deal means the Kingdom’s $650 billion sovereign wealth fund will be central to the future direction of golf.

PIF Governor Yasir Al-Rumayyan will chair the board of the new commercial entity, with PGA Tour owner Jay Monahan as chief executive. However, the PGA Tour would have majority voting rights in the combined entity.

“Logically we should work together; We should not work against each other,” Al-Rumayyn told the Financial Times.

Al-Rumayyan, who will also sit on the PGA Tour’s policy board, said golf was integral to Saudi ambitions in the sport as Riyadh pushes reforms aimed at making the kingdom less dependent on oil.

The tours also said they intended to create a way for players who left the US and European circuits for LIV Golf to reapply for membership.

PGA and PIF will form a yet-to-be-named joint commercial entity with a major minority investment from PIF. The details of the stake and its value are still being determined, although the PIF will be the exclusive outside investor with the right of first refusal on future capital commitments.

The Framework Agreement was mediated over two months of meetings between the PGA and the PIF in the US, Europe and the Middle East. Monahan, who once said the PGA was focused on “legacy, not leverage”, told the Financial Times on Tuesday that he began to trust Al-Rumayyan “after 10 minutes of sitting down with him in Venice”.

The LIV Tour launched its tournament schedule a year ago in London. In addition to offering rich signing bonuses to players, the field was limited to 48 players and 54 holes were played over three days.

Its team-based format was inspired by newer competitions such as the Formula One car racing series and the Indian Premier League, which has become a driving force in cricket since its inception in 2008.