Last week the PGA Tour finally buckled under enormous pressure and agreed to join a new for-profit venture funded by the Saudi Public Investment Fund. The merger brings together the PGA Tour and the European Tour, under the financial backing and chairmanship of PIF governor Yasir Al-Rumayyan. What it does not do, in technical terms, is merge the PGA Tour with LIV Golf, the PIF-funded breakaway league launched in 2022 specifically to undermine the PGA Tour's dominance of men's professional golf. The wrong way to imagine this would be to picture PGA Tour commissioner Jay Monahan and LIV Golf CEO Greg Norman shaking hands as their competing entities come together in a marriage of state. Instead, think of a marriage of convenience between Monahan's PGA Tour and the PIF's bank account, with LIV Golf as the PIF bank account's small, rowdy, and suddenly disinherited child from a previous partnership. And, as part of the terms of the marriage, Monahan has been given the go-ahead by Al-Rumayyan to murder his new stepchild if he deems it unworthy of his love.
That's one of the funnier quirks of this deal, which, according to a report from the Wall Street Journal, finally came together when Monahan looked at the finances and realized that fighting LIV Golf and the PIF, commercially and in litigation, would soon bankrupt the PGA Tour. As Monahan explained to stunned PGA Tour employees on June 8, rejiggered payouts under the promotion's upgraded Player Impact Program and increased purses for "elevated" tournaments—all negotiated with players last summer—have recently caused the PGA Tour to dip into a $100 million reserve fund, without a corresponding boost in sponsorship revenue to cover the expenses. Meanwhile the Tour had already spent $50 million to fight a PIF-funded antitrust lawsuit filed in August 2022, and to push a subsequent countersuit. Those cases threatened to continue into the distant future. The Journal reports that "a trial date in 2024 could be delayed" as Al-Rumayyan and the PIF continued to fight discovery and challenge the court's subject-matter and personal jurisdiction. Sources told the Journal that the costs of litigation for the PGA Tour might eventually reach into the hundreds of millions of dollars.
There's a tempting counterfactual out there for the pondering, where the PGA Tour willingly granted releases to 17 players in June 2022, to compete in that inaugural LIV Golf event in London. That might've saved the PGA Tour the annoyance and expense of the antitrust lawsuit, but the footing simply did not exist—due to a combined dearth of resources, member solidarity, moral conviction, and organizational agility—for the PGA Tour to avoid becoming a prized part of Al-Rumayyan's sprawling sportswashing operation. The staggering scale of the PIF's resources comes zooming into view in the Journal's report: The PGA Tour clears somewhere shy of $2 billion in annual revenue; the PIF last year had more than $740 billion in accumulated wealth, including a staggering $45 billion in cash. If the PIF wasn't going to crush and bleed the PGA Tour into surrender via expensive litigation, it had the resources to inflate its enticements beyond all rationality. The PGA Tour was never all that committed to turning down a share of this wealth, but it didn't matter. In this or any other pissing contest, the PIF will quite simply never run out of piss.
The funny uncertainty in the merger's aftermath is the question of who is screwing who. Monahan, who was commissioner of the non-profit PGA Tour, will reportedly be made CEO of the as-yet unnamed for-profit venture. Al-Rumayyan will be chairman, and though the PGA Tour's honchos claim that they'll retain power with a stacked board, the PIF has all the money. But, in a delightful twist, everyone agrees that it will be up to Monahan to decide what becomes of the LIV Golf promotion. The tour's future prospects don't look real great. ESPN reported Friday that even if Monahan sees a future for the goofy team format, sources "at the highest levels of the sport" say that that it "won't be in LIV Golf's present form," and that LIV Golf's mouthpiece of a CEO, Greg Norman, left without a title following the merger, will be out on his ass. No one is going to miss those shotgun starts and thumping rhythms more than Norman, who, if he had not been cruelly usurped, might've considered himself entitled to a victory lap.
So what would happen to LIV Golf's players if that promotion folds? PGA Tour board member and would-be 9/11 avenging angel Jimmy Dunne says those players would have to apply for reinstatement in the new venture. Worse, he says that a panel featuring PGA Tour members and administrators would have the power to mete out punishment to these players for their defection.
"Remember, they're coming back to compete on the tour, so they have to be confident that they would be good enough to continue to play, and they have to be willing to incur the penalty for having gone," Dunne said Friday. Sports Illustrated spoke to Dunne Thursday and came away with the sense that "penalties to return to the Tour will be significant" for the LIV Golf defectors. And they will be frozen out of one of the key benefits on order for the PGA Tour's loyalists: According to Dunne, PGA stalwarts will receive equity shares in the new for-profit enterprise, to compensate them for the riches in Saudi payoffs they declined in refusing to participate in the LIV Golf leverage gambit. LIV Golf's renegade early adopters, on the other hand, will apparently get nothing.
Everyone who wants to earn a living at men's professional golf will now have to accept the terms of this new behemoth. The PGA Tour's holdouts will get equity shares in a venture backed by a fund that the loudest among them spent the past year decrying as morally reprehensible. And LIV Golf's defectors will now have to come crawling back on their bellies, accept penalties for having showed up early to the feast, and find themselves frozen out of a key benefit in an enterprise made possible by their individual leaps of faith. If there were anyone left in all of men's professional golf to accuse this new venture of anticompetitive behavior, they might have a case.
