7 things we learned from leaked PGA Tour-Saudi PIF agreement

Twenty days after the surprising announcement of a “framework settlement” between the PGA Tour and the Saudi Arabian Public Funding Fund, confidential copies of the deal turned public Monday evening. The doc, which was first reported on by The Athletic and No Laying Up and in addition obtained by GOLF.com, was despatched to Congress Monday night, forward of the July 11 Senate listening to on the proposed partnership.

In line with the five-page accordwhich was signed Could 30, the proposed firm — quickly named NewCo — “would be the entity for skilled golf,” however in the meanwhile the PGA Tour, DP World Tour and LIV Golf will coexist. The PGA Tour will maintain its powerful position atop the boys’s skilled golf world, its pricey litigation now nullified, whereas forging an unsure future that would see Tour members and LIV golfers frequently competing in the identical tournaments.

Importantly, that is all a part of an preliminary settlement, solely components of that are legally binding. “Definitive Agreements” are cited all through the deal that these once-warring sides hope to ratify. The doc has been shared with Congress as a result of your entire proposal is under investigation by both the U.S. Senate and Division of Justice. A listening to is scheduled for July 11, which the PGA Tour has mentioned it plans to attend. LIV Golf declined to remark when requested if it will be in attendance, and the PIF didn’t reply to an inquiry about its intentions.

LIV Golf and the PGA Tour have been embroiled in multiple lawsuits all through 2022 and early ’23, one among them centered on alleged anticompetitive practices of the PGA Tour. For a significant market shareholder to all of the sudden merge its enterprise pursuits with its main competitor(s) is a transfer we’ve seen in different professional sports activities, however that also garners shut consideration from U.S. lawmakers. This proposed partnership, as a result of it includes the DP World Tour, can also be prone to face investigation from European regulators.

Key particulars:

1. One through-line of the doc, as previously reported by GOLF.comare clauses that guarantee energy for the PGA Tour. The PIF is investing and bringing its golf belongings to the desk — one among which is LIV — however the PGA Tour will keep voting management of the NewCo board. Extra funding from the PIF — and/or actions below its proper of refusal on new capital raised — is not going to enhance its presence past a non-controlling voting curiosity.

2. LIV Golf’s future, in addition to that of workforce golf, is unclear. It’s not useless, nevertheless it’s definitely not assured to outlive, both. When PGA Tour commissioner Jay Monahan repeatedly mentioned an “empirical analysis” would happen on the prospects of LIV Golf, he was merely quoting the settlement:

“NewCo shall be supplied entry to all data requested to facilitate this analysis and evaluation … in order that the NewCo Board, with suggestion of its [CEO] Jay Monahan, will decide the continued plan and technique concerning all NewCo operations…”

In different phrases, Monahan will maintain many playing cards. Jimmy Dunne and Ed Herlihy — each proposed members of the NewCo govt committee — would additionally possess a lot affect. Will they need LIV Golf to exist because it at present does? Monahan mentioned himself that’s unlikely. May the league be repackaged because the PGA Tour’s personal model of workforce golf? That’s believable. The settlement states that the events “will make a superb religion evaluation of the advantages of workforce golf…and decide how finest to combine workforce golf into PGA Tour and DP World Tour occasions going ahead.”

3. Gamers who left for LIV Golf could be allowed to return, however with particular qualifiers. For starters, no gamers shall be allowed again earlier than the 2023 season performs out. (Additionally, in the meanwhile, no gamers shall be recruited to play for LIV groups.) Extra vital, the PIF, PGA Tour and DP World Tour shall be setting “truthful standards and phrases of readmission per every Tour’s disciplinary insurance policies.” That seemingly implies that totally different gamers who left at totally different occasions and in several methods — i.e. departed largely silently or went as far as to recruit different gamers — shall be dealt totally different phrases for reinstatement. Phil Mickelson, for instance, was one of many first gamers officially suspended by the PGA Tourin March 2022, when he labored to recruit gamers to hitch LIV, in line with courtroom paperwork.

4. The phrases “good religion” are used all through the settlement, however maybe most vital regarding the Official World Golf Rating: “The events will cooperate in good religion and use finest efforts to safe OWGR recognition for LIV occasions and gamers below OWGR’s standards for contemplating LIV’s software.” LIV occasions haven’t obtained world rating factors since its inception, which has triggered the world rating for every of its commitments to fall in consequence, and triggered nice consternation among the many upstart league’s strongest supporters. The one participant whose rating has risen since becoming a member of LIV was Brooks Koepka, who has performed properly in main championships in 2023. The settlement appears to state that LIV occasions may earn rating factors sooner or later, however no particulars have been finalized past that.

5. Pending approval and the assorted investigations, the PIF would change into a company associate of the PGA Tour and DP World Tourwhereby the three sides would “determine a excessive profile occasion for which the PIF or its designee(s) will make a monetary funding to function title sponsor.”

The PIF is already a title sponsor of the Saudi Worldwide, which is now in its fifth yr. The occasion was initially sanctioned by the DP World Tour however lately was rebranded “PIF Saudi Worldwide powered by Softbank Funding Advisors” and on the Asian Tour schedule. The settlement appears to make it not simply doable however seemingly that we may see a PIF-sponsored occasion on the PGA Tour schedule.

6. The PGA Tour Coverage Board may have a PIF-appointed member. We already knew this was coming — PIF governor Yasir Al-Rumayyan is about to hitch the board, as a part of the preliminary announcement — however the wording within the settlement portends that maybe one other PIF govt may take Al-Rumayyan’s place. The deal nonetheless creates an eleventh seat on the board, which at present consists of 5 PGA Tour gamers and 5 impartial administrators. The board has by no means as soon as blocked a choice that was unanimously permitted by its participant administrators, however it’s unclear if Al-Rumayyan’s inclusion would set off including a sixth participant director for stability.

7. There’s nonetheless a lot to be determined. A stipulation of the doc states that the contents of it can stay till (a) the Definitive Agreements are signed, (b) an extension is agreed to, or (c) Jan. 1, 2024 arrives. If neither A nor B takes place, the settlement between the PGA Tour and PIF shall be terminated.