PIF-PGA Tour agreement misses December deadline, pushed back to April

Sunday, December 31 was the deadline for a deal between Saudi Arabia’s Public Investment Fund and the PGA Tour/DP World Tour to combine commercial operations under the framework agreement struck in June this year.

It will pass without pen being put to paper on the matter.

According to several media platforms, a new for-profit entity combining either side is still elusive, though according to The Telegraph of London, it tentatively has a name – PGA Tour Enterprises. The June pact called for a final deal to be arrived at by the year-end. Speaking in the Bahamas ahead of the Hero World Challenge, Tiger Woods – now a member of the PGA Tour’s Policy Board – was confident this would happen.

“I am confident a deal will get done in some way,” Woods said. “Whether that comes on December 31 or is pushed back, everyone understands we're working together. There are no lawsuits. Everyone's understanding what that looks like, and we're all progressing going forward. Everyone's working right now with no animosity. We're trying to work to try and get a deal done for the Tour and for all parties involved."

Instead, April and the Masters 2024 is now the new deadline, with both sides fighting to gain an upper hand in the run-up to further talks. While the PIF-backed LIV Golf League has announced its 2024 schedule and added world number three Jon Rahm to its ranks in a bid to force the pace of talks, PGA Tour commissioner Jay Monahan has been in conversations with non-PIF investors in the tour’s for-profit arm to try and improve their bargaining power.

As part of his initiative, Monahan brought into the conversation a group of investors led by Liverpool FC owners Fenway Sports Group and tentatively titled the Strategic Sports Group which also includes a number of private investors to create a counter-balance to the push from PIF and its governor, Yasir Al-Rumayyan.

According to Patrick McDonald of CBS Sports, the original PIF-PGA Tour deal included a non-solicitation agreement to prevent LIV Golf from poaching PGA Tour players, including Rahm, during negotiations. However, that clause was removed amid antitrust concerns from the US Department of Justice, which created an opening for further player recruitment by LIV Golf before the new April deadline. Official interest in the PGA Tour and LIV Golf has further impeded the pace of play.

As per further reports on the investment into PGA Tour Enterprises, PIF is expected to add $4 billion to the kitty with SSG kicking in around $3 billion. This would still make them minority investors with the PGA Tour remaining majority owner of the company and players on both the PGA and DP World (European) tours receiving equity in the entity which was possibly arrived at a pre-Christmas meeting between Al-Rumayyan and Monahan in New York.

With Tiger Woods heading a group of players including Patrick Cantlay and Jordan Speith (who replaced Rory McIlroy on the Policy Board) determined not to be blindsided again by Monahan as had happened in the June announcement, player power is clearly to the fore and any understanding PIF and the other side will have to satisfy this constituency.

There is a great deal of unhappiness amongst PGA Tour player members with one group circulating a petition internally seeking clarification and clarity on a number of issues affecting them. In response to this the Policy Board has sent out a two-page memo to members that includes updates on the negotiations with PIF and “address speculation in our game”.

At around the same time, young Norwegian superstar Viktor Hovland publicly slammed the arrogance of Tour administrators though he denied any thoughts of shifting to the parallel tour. “It must be fair to say that the PGA Tour has done a damn bad job,” the 26-year-old said on a Discovery podcast. “It would be a bit silly to criticise players for leaving. I understand why he (Rahm) left. There’s a lot of money.”

The stakes on both sides are high. PIF has kept an open purse so far in its support of LIV Golf which has taken on the PGA Tour head-on in its 2024 scheduling while the other side has bled sponsors with Honda and Wells Fargo ending long associations with the game. Monahan also knows he has to deliver a deal that satisfies the player-members and keeps the PGA Tour’s bargaining power intact.