The PGA Tour and Saudi Public Investment Fund are "nearing a deal" for the soverign fund to make a $750 million investment in the PGA Tour's for-profit subsidiary, PGA Tour Enterprises.
Bloomberg reported the story Tuesday, citing sources close to the negotiation.
The $750 million investment would give the Public Investment Fund a 6 percent stake in PGA Tour Enterprises, which was formed in 2023 in anticipation of a deal with the Saudis and as a for-profit vehicle by which the non-profit PGA Tour parent company could take on investment capital.
The Saudi investment would be consistent with the same $12 billion valuation of the Tour's resources agreed to by Strategic Sports Group, which already invested $1.5 billion in PGA Tour Enterprises and can invest up to a total of $3 billion at the current valuation.
Join Golf News Net for $10 per year, and go ad-free!The deal isn't finalized, and the terms could change. The deal would also require regulatory approvals.
The PGA Tour, Saudi Public Investment Fund and the DP World Tour entered into a framework agreement, announced June 6, 2023, that was effectively an agreement to halt litigation and create a negotiating window to forge a final working agreement between the organizations. The December 31, 2023, deadline was extended in the name of good-faith negotiating, while the PIF-owned LIV Golf League made a huge splash in signing multi-time major winner Jon Rahm to a sizable contract.
Negotiations have continued throughout 2024, with most public comments on the PGA Tour side reflecting the complexity of the deal. Many of the PGA Tour policy board player members met PIF governor Yasir Al-Rumayyan for the first time in March, and PGA Tour commissioner Jay Monahan spent time in Saudi Arabia -- and other places -- to further negotiations with Al-Rumayyan. The pair played together in the DP World Tour's Alfred Dunhill Links Championship in October in Scotland, spurring talk of an imminent deal. However, at last week's Hero World Challenge, policy board member Tiger Woods said he wasn't sure what "form" a deal with the Saudis would take, but he did seem confident something would get done.
The DP World Tour is also reportedly considering a separate deal with the Saudis that would amount to PIF funding for operations and purses in exchange for schedule considerations and ending financial penalties against dual members who play in LIV Golf events. The PGA Tour and DP World Tour have a "strategic partnership" in which the PGA Tour subsidizes purses and owns a sizable portion of European Tour Productions, the media-production arm of the DP World Tour's parent organization.
What this deal would mean for the PGA Tour and broader professional golf, beyond a financial commitment from the Saudis, is unclear.
Al-Rumayyan and the PIF have invested billions in LIV Golf, including player acquisition and purses, but with little return. Domestic TV ratings for LIV events are poor, sponsorship opportunities are not abundant, media rights fees are not currently being paid and the 13 LIV Golf teams have struggled to find investors looking to get involved in the concept. However, LIV Golf is likely to continue in some fashion, not only because of the investment but also potential federal scrutiny of the deal's potential to further monopolize professional golf.
Would the PGA Tour welcome back LIV Golf players who still retain some kind of status, mostly through major championship wins in the last five years or through PGA Tour lifetime membership? Would PGA Tour players be able to freely play LIV Golf events? How could both organizations align schedules to allow for some form of co-existence?
There's a lot more to this deal than money, and for fans of the men's professional golf, the most important piece is a schedule and presentation that feels unified.
