A Senate panel investigating the proposed tie-up between the PGA Tour and Saudi-backed LIV Golf pried loose new details on the deal’s financing and side arrangements in a hearing Tuesday.
(Bloomberg) — A Senate panel investigating the proposed tie-up between the PGA Tour and Saudi-backed LIV Golf pried loose new details on the deal’s financing and side arrangements in a hearing Tuesday.
PGA Tour Chief Operating Officer Ron Price and PGA Tour Policy Board Member Jimmy Dunne, who helped negotiate the agreement, defended the merger against senators’ concerns that Saudi Arabia will use investments in golf to divert attention from human rights abuses. New documents released by the Senate’s Permanent Subcommittee on Investigations also raised antitrust concerns.
Here are the key takeaways:
$1 Billion Investment
A Saudi sovereign wealth fund would invest more than $1 billion in a merger between PGA and LIV if it is completed, Price testified.
Pressed by Senator Richard Blumenthal, the panel’s chairman, on how much the Saudis would invest, Price responded, “a significant amount. North of $1 billion.”
Greg Norman Out
Documents released by the subcommittee revealed an effort by PGA to oust LIV Chief Executive Officer Greg Norman as part of the deal.
When asked by Blumenthal if Norman would be out of a job, Price responded that Norman’s position would no longer be required if the entities combined.
PGA ‘On Fire’
The PGA officials argued the association couldn’t compete with LIV because of its deep pockets. Losing just five players a year to LIV would be enough to “gut” PGA, Dunne said.
“LIV put us on fire. LIV put us in an incredibly difficult position,” Dunne said. “LIV was a constant everyday, who’s going to go? It was very disruptive.”
Price and Dunne touted the agreement as a way to end the competition, but allow PGA to continue to operate as it currently does.
Dunne told the lawmakers he fears that if an agreement is not reached, LIV could “end up owning golf.”
Golf Teams for Woods, McIlory
Bankers representing the Saudi sovereign wealth fund PIF, LIV’s largest benefactor, wanted Tiger Woods and Rory McIlroy to each own a LIV golf team and play in at least 10 LIV gold events.
The proposal was included in an April 26 presentation entitled “The Best of Both Worlds” created by PCP Capital Partners after a meeting between the rival tours in London. The subcommittee staff, which obtained the document, released it at the hearing.
Saudi Non-Disparagement
The deal PGA made with LIV Golf and the Saudi sovereign wealth fund includes a broad non-disparagement clause that Blumenthal argued could prevent criticism of Saudi Arabia.
But Price said players wouldn’t be punished for criticizing Saudi Arabia or its policies even if the association completes a merger with LIV.
“Our position is players are free to speak their mind,” Price testified.
–With assistance from Leah Nylen.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.