A few days before the start of a US Senate subcommittee investigation into the PGA Tour’s planned partnership with the Saudi Arabian Public Investment Fund (PIF) and the DP World Tour, PGA Tour Commissioner Jay Monahan told Congress that his golf circuit was «abandoned.» on our behalf.»
Monahan sent a letter to lawmakers alleging that the PGA Tour’s position was weakened when it came to competing with Saudi Arabia’s bid to take over the sport with LIV Golf due to the United States’ geopolitical alliance with the kingdom.
The PIF has an estimated $620 billion at its disposal, and the PGA Tour had already incurred $50 million in legal fees and earmarked another $100 million for jackpot prizes at its tournaments, according to a report from The Wall Street Journal.
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Jay Monahan speaks to the media as a Players Championship advance at TPC Sawgrass on March 7, 2023 in Ponte Vedra Beach, Florida. (David Cannon/Getty Images)
The deal, while not yet finalized, would end all litigation between the PGA Tour and the PIF. Since its inception, the LIV circuit has managed to sign some of the biggest names in golf to lucrative contracts. In some cases, golfers have signed deals worth more than $100 million.
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The PGA Tour responded by pouring millions into its own tournament purses.
«During this intense battle, we met with various members of Congress and policy experts to discuss the PIF’s attempt to take over the game of golf in the United States, and suggested ways Congress could support us in these efforts,» Monahan wrote. . «While we are grateful for the written statements of support we received from certain members, we were largely left alone to fend off attacks, apparently due to the United States’ complex geopolitical alliance with the Kingdom of Saudi Arabia.»
Monahan added that the legal battles could have lasted for years and come at great cost.
«This left the very real prospect of another decade of costly and troublesome litigation and the long-term existence of the PGA Tour under threat.»
Three days after Monahan’s letter, first reported by Politico and obtained by The Associated Press, the leader of a Senate subcommittee demanded records from the PGA Tour and Saudi golf interests amid «serious questions» about how reached the agreement.
Sen. Richard Blumenthal, D-Conn., chairman of the Senate Permanent Subcommittee on Investigations, also said he wanted to hear the PGA Tour’s plan to maintain its tax-exempt status.
It was not clear to whom Monahan sent his letter because it was redacted, although it was believed that not all members of Congress received it.
“We believe we did everything possible to defend what we stand for, including spending tens of millions of dollars to defend against litigation instigated by LIV Golf – significant funds diverted from our core mission to benefit our players and generate charity,” Monahan said. .
He said the tour secured a federal court ruling that PIF was not protected under the Foreign Service Sovereignty Act because a judge had said the Saudi wealth fund was doing business in the US in Denver, spreading antitrust lawsuits. at least until the middle of next year.
Monahan said the deal was not a merger with LIV Golf, a 48-player league that has a team component and plays eight of its 14 tournaments in the United States.
The LIV Golf logo is displayed on July 29, 2022 at Trump National Golf Club in Bedminster, New Jersey. (Rich Graessle/Icon Sportswire via Getty Images)
Last week’s announcement was for PIF, the PGA Tour and the European tour to unite their business interests, which include PIF-funded LIV Golf. It is not yet clear if LIV Golf will continue after this year and how players who defected from the PGA Tour might return.
Monahan has referred to the deal only as a framework, and even at a meeting of hostile players last week at the Canadian Open, he couldn’t offer many details.
In his letter to lawmakers, Monahan said the agreement would allow the PGA Tour to run tournaments as before, with him as commissioner and New York attorney Ed Herlihy as chairman of the board.
The PGA Tour logo is seen at the Farmers Insurance Open at Torrey Pines South on January 29, 2021 in San Diego, California. (Photo by Ben Jared/PGA Tour via Getty Images)
Monahan would be the chief executive of the new for-profit company – he described it as a subsidiary of the PGA Tour – with Yasir Al-Rumayyan as company president. Al-Rumayyan is the governor of the Saudi Arabian wealth fund.
Monahan, Al-Rumayyan, Herlihy and Jimmy Dunne, the PGA Tour board member who helped broker the deal, would form the executive committee.
«The PGA Tour will at all times have a majority of the Board seats and will have control of this new entity, regardless of the size of PIF’s investment,» Monahan said, adding that PIF would be a minority investor.
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«In essence, the PIF is investing in the PGA Tour just like it has invested in other US-based companies,» he said. «The PGA Tour and its tournaments will continue to operate as they do today, generating significant charitable and economic impact in the communities where they are played.»
Associated Press contributed to this report.