The PGA Tour and its Saudi-backed competitor LIV Golf have reached a framework agreement that combines the entities into a new for-profit company.
The deal, which also includes DP World Tour (the PGA European Tour), would effectively end the pending antitrust litigation battles between the two companies.
LIV Golf is funded by the Saudi Arabia Public Investment Fund (PIF), which in turn is controlled by the Saudi crown prince. LIV began making huge waves in 2022 when it began poaching PGA Tour stars, including two-time major champion Dustin Johnson, who reportedly received a LIV deal worth $150 million, as well as Phil Mickelson and Bubba Watson.
As part of the deal, the groups will establish “a fair and objective process for any players who want to re-apply for membership with the PGA Tour or DP World Tour” after the 2023 season, according to a statement.
Notably, the agreement still requires approval from the PGA Tour policy board, according to a memo to players from commissioner Jay Monahan obtained by CNBC and others.
“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.
Should it go through, the PIF plans to spend billions on the combined company, according to reports, and PIF governor Yasir Al-Rumayyan is expected to serve as chairman.
Trouble on the green
Conflict between the entities ensued when LIV Golf sued The PGA Tour in August for banning its players from competing in LIV events. PGA sued back, claiming LIV was stifling competition.
LIV matches weren’t distributed in the US until just a few months ago when the league reached a deal with the CW Network. The network agreed to air 14 LIV events that began in February.
Then there’s the controversy of the LIV’s Saudi backing. Critics have slammed the league from the outset, accusing the PIF of spending billions on “sportswashing” the kingdom’s history of human rights violations.
Meanwhile, former President Donald Trump has hosted LIV events at his golf courses. He previously called a merger between the two leagues “inevitable” on Truth Social and on Tuesday expressed his excitement over the deal.
“Great news from LIV Golf. A big, beautiful, and glamorous deal for the wonderful world of golf. Congrats to all!!!”
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
Follow him on Twitter @andrew_kessel