The PGA Tour is set to tee off in a new era of men's professional golf. An agreement signed by key stakeholders – PGA Tour Commissioner Jay Monahan, DP World Tour CEO Keith Pelley, and Public Investment Fund (PIF) Governor Yasir Al-Rumayyan – marks the birth of a new entity.
According to the five-page pact, the PGA Tour retains "full decision-making authority with respect to all strategic and operational matters related to competition." The agreement underscores a shared vision among the signatories "to create a global golf partnership aimed at growing and promoting the game of golf globally." It hopes to end existing divisions and unify the sport for the benefit of all stakeholders, including players, sponsors, and worldwide fans.
In a statement released on Monday, the PGA Tour heralded the pact as a framework for the future of professional golf under its leadership, benefiting "players, fans, and the sport." Following the recent resolution of litigation, the parties are "working productively towards a definitive agreement." However, any agreement will be subject to approval by the full board of the PGA Tour, including its player directors.
Control and Compliance Amidst Scrutiny
Despite the potential influx of investment from the PIF, the PGA Tour will maintain a controlling voting interest, the agreement stipulates. The PGA Tour parent organization will continue to hold its current level of regulatory oversight over the game of golf concerning the assets contributed by the PGA Tour, including sanctioning events, setting competition rules, and managing the inside ropes.
A new commercial entity, nicknamed "NewCo," will be established. The PGA Tour and PIF will cooperate in good faith to agree on the economics, valuation, and governance terms for NewCo and PIF's investment therein. However, this proposed alliance is not without scrutiny.
The U.S. Department of Justice's Antitrust Division and two U.S. Senate committees are scrutinizing the deal. Sen. Richard Blumenthal, D-Conn., chairman of the subcommittee, expressed concerns over the PGA Tour's partnership with the Saudi Public Investment Fund.
"Our goal is to uncover the facts about what went into the PGA Tour's deal with the Saudi Public Investment Fund and what the Saudi takeover means for the future of this cherished American institution and our national interest," he said on June 21.
"Americans deserve to know what the structure and governance of this new entity will be." Image by brgfx on Freepik