Big golf organizations that were once enemies in court are now partners in business.
The PGA Tour, Europe and Saudi Arabia's Public Investment Fund (PIF) announced on Tuesday that they are merging their golf businesses into a single new company.
The announcement was so shocking that not even PGA Tour players knew about the move.
Before the announcement, the PGA Tour had been fighting the Saudi-supported LIV Golf in court for more than a year.
The PGA Tour asked a U.S. federal court to require Yasir Al-Rumayyan, the governor of the PIF, to give evidence in a legal case.
Now, all lawsuits are being dropped. Al-Rumayyan will take a seat on the PGA Tour board of directors. He also will be chairman of the new business involving three golf organizations.
Here are some details about this very unusual sports deal:
What is LIV Golf?
LIV Golf is a sports organization supported by Saudi Arabia’s sovereign wealth fund that held its first event in 2022. LIV Golf has been a direct competitor to the PGA Tour. LIV Golf has tried to reinvent the structure of professional golf. This includes changes such as 48-man tournaments in which players with high scores are not cut and which offer up to $25 million in prize money. There are also teams.
Australian Greg Norman, a former PGA Tour star, is the chief of LIV Golf. The organization succeeded in getting 13 former major champions, including Americans Phil Mickelson and Dustin Johnson, to play in their events. As a result, those stars were suspended by the PGA Tour.
Why did Saudi Arabia want to create a golf league?
Saudi Arabia has been investing in sports and entertainment in recent years. It is all part of Crown Prince Mohammed bin Salman's plan called “Vision 2030” to reduce Saudi Arabia’s dependence on oil. Golf appeared to be a natural fit.
However, the move has led to accusations of “sportswashing.” That is an attempt to use sports investments to take attention away from human rights abuses.
Why are PGA Tour players angry at LIV players?
LIV Golf was trying to get all the top players in the world ranking. A majority of them turned down money offers estimated at $100 million or more to stay loyal to the PGA Tour.
Northern Irish golfer Rory McIlroy accused LIV players of “taking the easy way out.” American Tiger Woods said they “turned their backs” on the tour that made them famous. The competition also caused a great divide in golf because LIV players were not permitted to play on the PGA Tour. Now some players are angry that LIV players might return without consequences.
Wednesday, McIlroy said he was hopeful the merger would use Saudi money “the right way.”
“Whether you like it or not, PIF and the Saudis want to spend money on the game of golf. They want to do this, and they weren’t going to stop,” he said.
Why did the merger happen?
Jay Monahan is the commissioner of the PGA Tour. Monahan had refused to meet with the Saudi Golf group for two years. But a few months ago, PGA Tour board member Jimmy Dunne organized a meeting. Monahan, European Tour chief Keith Pelley and Al-Rumayyan began working out an agreement.
Monahan found that LIV Golf had a deep supply of money and meant to continue. He said golf was too divided and had too much tension. It was best for everyone to come together.
The PGA Tour will remain a non-profit organization under U.S. tax law. The PGA Tour and European Tour also will keep the same tour events and logos.
Where will LIV Golf players play next year?
LIV Golf will finish its second season this year as planned. After that, the next steps remain unclear. Monahan said officials will study how to bring team golf into the PGA Tour. LIV Golf was trying to turn its 12 teams into franchises. However, no one had financially supported a team.
But it is unlikely that if LIV Golf still exists, players can play on the other tours. That is what led to the dispute and court cases in the first place.
I’m Dorothy Gundy. And I’m Dan Novak.
