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As they charged toward a shocking partnership, the PGA Tour and the Saudi Public Investment Fund discussed a variety of dramatic measures that would significantly alter the landscape of professional golf, according to a trove of documents released by a Senate investigative subcommittee during Tuesday’s hearing on the proposed deal.
Among the proposals that were floated: a global “World Golf Series” team event that would conclude in Saudi Arabia; LIV Golf continuing to operate as an independent tour with its schedule confined to the fall season; Greg Norman being sidelined and removed from his role as LIV Golf chief executive; Tiger Woods and Rory McIlroy being given ownership of LIV Golf teams and participating in LIV Golf events; two elevated PGA Tour events branded by either PIF or the Saudi oil company Aramco; and a membership to the Augusta National Golf Club for Yasir Al-Rumayyan, the governor of the PIF who is poised to be among the most powerful men in golf if the alliance is finalized.
Many details of the deal between the PGA Tour and the Saudi investors are unknown and still subject to negotiation, but the documents released Tuesday during the Senate Permanent Subcommittee on Investigations hearing into the surprising agreement give the fullest picture to date of what the key stakeholders had hoped to get out of the partnership.
Sen. Richard Blumenthal (D-Conn.), chair of the subcommittee, shared a 10-page summary document plus an additional 265 pages of supplementary emails, messages and other communications that were submitted to the subcommittee by the PGA Tour and LIV Golf in advance of Tuesday’s hearing.
Blumenthal was the most pointed lawmaker in his questioning of the PGA Tour representatives – Ron Price, the tour’s chief operating officer, and Jimmy Dunne, a member of the tour’s policy board and a key architect of the agreement – urging them “to avoid the sellout that this deal appears to be” and warning that accepting Saudi money will not alleviate the tour’s woes.
“Looking at it from the future standpoint, you’re not out of the woods,” he said toward the end of the hearing. “They’re going to continue to have this kind of bucket full of money and they’re going to continue to wield the influence that they do … and whatever the good intention and rhetoric is now, you still have to reach a deal. My hope is that you will resist those buckets full of money.”
The tour officials noted that a final agreement is not imminent and the two sides continue to negotiate.
“Being here in Washington, worrying about this, consumed with this, no, it’s making it a lot harder,” Dunne told the subcommittee, “a lot, lot harder.”
Dunne acknowledged that the parties did a poor job of explaining their agreement, calling the initial rollout “very misleading and inaccurate, which was everyone’s fault. There is no merger … there is simply an agreement to try to get to an agreement and settle the lawsuit.”
The documents released by the subcommittee provided new insight into the discussions that led to the tour and the Saudi PIF moving past their bitter differences and striking an alliance to unify professional golf under a single umbrella, with the goal of forming a new for-profit entity that would oversee the commercial interests of the PGA Tour, LIV Golf and the Europe-based DP World Tour.
The documents also show several iterations of the framework the two sides hammered out and seem to suggest that the parties are open to LIV Golf coexisting alongside the PGA Tour. The communications do not reveal the size of the potential Saudi investment or lay out parameters for the LIV golfers to return to the PGA Tour. One initial proposal noted that Al-Rumayyan recognizes “the merits of compensating those PGA players who have remained loyal to the Tour and he would undertake to establish a substantial Equalisation Fund for their benefit.”
Emails reveal that the first overture was made to the tour by an intermediary Roger Devlin, a successful British businessman who reached out to Dunne last December. He wrote: “While the parties may appear far apart right now I do believe there is a common desire among the leading players and shared by His Excellency [Al-Rumayyan] to bring the sport back together in time to impact the 2024 schedule.”
According to the documents, the two sides didn’t meet in person until an April introduction in London, followed by meeting in Venice on May 11. They met again at the end of May in San Francisco, where the basic framework was agreed to and signed.
In the interim, they batted proposals back and forth. On April 26, the Saudi’s representatives shared a slide show, titled “The Best of Both Worlds,” in which they proposed Woods and McIlroy’s involvement with LIV. And in May, the two sides exchanged language that would oust both Norman and Performance54, the golf management company that helps run LIV, from all operations.
None of that was included in the basic agreement that was signed on May 30. It was not clear from the Senate documents if any of those proposals are still under consideration by the PGA Tour and the PIF. Two people familiar with the negotiations said that PIF officials rejected the proposal to remove Norman.
Price made clear to the subcommittee Tuesday that because the PGA Tour would manage any potential LIV Golf events, “it would make no sense” to have Norman leading LIV.
“If we reach a definitive agreement, we would not have a requirement for that type of position,” Price said.
The PGA Tour execs faced the heavy task Tuesday of selling the subcommittee on the controversial partnership – not to mention golfers, fans and regulators who are all watching the developments closely. Tour officials stressed that the organization isn’t simply turning over control of professional golf to a foreign entity.
“We do not have an agreement now. We only have a framework agreement. We will not move to a definitive agreement unless the PGA Tour is in complete control of the new entity,” Price said, “which will be a PGA Tour subsidiary controlled by the PGA Tour board and operated for the benefit of all of our constituents, our players, our fans, our sponsors and our charity. If that’s not where we end up, we will not even recommend approval.”
Blumenthal pushed back on the tour executives, saying the PIF money inherently gives control to the Saudis.
“There is something that stinks about this path that you’re on right now,” he said, “because it is a surrender and it is all about the money. And that’s the reason for the backlash that you’ve seen. The equity ownership interest that the Saudis will have – and that’s a term from this agreement – gives them financial dominance. They control the purse strings.”
The tour’s witnesses could not say how big the potential Saudi investment might amount to, but it’d likely be “north of $1 billion,” Price said.
“The money is the reason you surrendered in this agreement,” Blumenthal said, saying the billion dollars would be “just the beginning.”
Some Republican senators took issue with the hearing, saying it was premature for Congress to probe a potential agreement between private parties.
The PGA Tour “did not seek this. They were put in this position,” said Sen. Ron Johnson (R-Wis.), the subcommittee’s ranking member. “The Saudis have the $700 billion. If they want to be involved in golf, they will be involved in golf. And if this thing fails, they can spend the money to take over golf. And I think that would be tragic. I think it would destroy golf because it would destroy the competitive spirit.”
While the basic framework between the parties is vague on the future of LIV Golf, the breakaway circuit that precipitated golf’s civil war, it merited plenty of discussion. On May 15, Ed Herlihy, chair of the tour’s policy board, said in an email to Dunne that he’d “raised the idea” to Jay Monahan, the tour commissioner, “of you overseeing LIV going forward. He really liked it.” Dunne replied to Herlihy, “You and me.”
And Price sent Monahan some talking points on May 28 to address some lingering PIF concerns, including the future of LIV. Price pointed out that “LIV Golf is important to PIF, but PIF, as a minority owner, has no decision-making authority … with respect to LIV’s future.” He noted that the PGA Tour would effectively be majority owners of LIV and the breakaway circuit’s fate would ultimately be determined by the executive board of the new for-profit company – “where PIF has a strong influence.”
The documents reveal deliberations on how to announce the deal – including planned phone calls to Woods and McIlroy – which underscored the secrecy behind the negotiations. Michael Klein, the New York banker and longtime PIF adviser, suggested announcing the news in a “brief, softball segment” with CNBC, as Monahan and Al-Rumayyan did on June 6.
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