In a groundbreaking development in the world of golf, the PGA Tour and European Tour have agreed to work alongside Saudi backers of LIV Golf to establish guidelines for the return of defectors from the rival league. A framework agreement, recently obtained by The Associated Press, sheds light on the formation of a for-profit company, the coexistence of LIV Golf, and the future direction of professional golf.
The agreement’s details were brought to public attention as Senator Richard Blumenthal requested documents for an upcoming hearing, aiming to scrutinize the PGA Tour’s deal with the Saudi Public Investment Fund.
Navigating the Return
The framework agreement, signed on May 30, outlines the collaboration between the PGA Tour, European Tour, and the Saudi investors to determine the process for players desiring to reapply for membership.
The goal is to establish a fair and objective procedure in line with each tour’s disciplinary policies. Players who participated in LIV Golf events were suspended by the PGA Tour due to non-compliance with release requirements, with these suspensions expected to extend through at least the 2024 season.
New Entity and Future Integration
The framework agreement envisions the creation of a new for-profit company, referred to as “NewCo,” that will serve as the primary entity for professional golf. The PGA Tour and European Tour will retain a controlling interest in NewCo, irrespective of the amount contributed by the Saudi Public Investment Fund.
One of the key objectives of NewCo will be to evaluate LIV Golf’s prospects and potential, assess the benefits of team golf, and explore opportunities to integrate team golf into future PGA Tour and European Tour events.
Challenges and Pending Details
While the framework agreement provides crucial insights, certain details are yet to be finalized. The future of LIV Golf remains uncertain, and the exact investment amount from the Public Investment Fund has not been specified.
The agreement indicates that NewCo will conduct an empirical data-driven evaluation of LIV Golf before deciding on the best strategy for integrating team golf into their respective events.
Recognition and Financial Contributions
The agreement also highlights efforts to seek Official World Golf Ranking (OWGR) recognition for LIV Golf. However, LIV Golf currently falls short of several OWGR criteria, including the absence of cuts and 48-man fields in their events.
Additionally, the Public Investment Fund intends to make financial investments as a premier corporate sponsor of either the PGA or European Tour, potentially becoming a title sponsor. The fund also aims to contribute to a program dedicated to growing the game of golf.
Timeline and Resolving Litigation
The parties involved have set a deadline of December 31 to reach a definitive deal. If the agreement is not finalized by then, they may choose to extend the deadline or revert to their previous arrangements.
Notably, the agreement serves to dismiss all pending litigation, including the antitrust lawsuit filed by the PGA Tour and the countersuit by LIV Golf, with the Public Investment Fund as a co-defendant. These lawsuits were recently dismissed by a federal judge in California.
Shaping Golf’s Future
As the golfing landscape undergoes significant transformations, the collaboration between the PGA Tour, European Tour, and Saudi investors represents a pivotal moment in the sport’s history. While uncertainties remain, the framework agreement provides a foundation for guiding the return of LIV Golf players and exploring the integration of team golf into future events.
The upcoming hearing led by Senator Richard Blumenthal is expected to shed further light on the PGA Tour’s deal with the Saudi Public Investment Fund, safeguarding the interests of American golf and fostering transparency in this evolving partnership.
