Sources: PGA Tour finalizes $3B deal as LIV talks continue،
The PGA Tour has finalized a deal with Strategic Sports Group, a consortium of billionaire sports team owners, to inject at least $3 billion into a new for-profit entity, PGA Tour Enterprises, sources told ESPN on Wednesday.
PGA Tour Commissioner Jay Monahan was expected to inform members of the PGA Tour, PGA Tour Champions and Korn Ferry Tour of the deal during a conference call Wednesday morning.
The conference call, scheduled for 9:30 a.m. ET, will be listen-only. The player relations staff informed tour members in a memo that there would be several meetings and touchpoints over the coming weeks to answer their questions and provide additional details.
ESPN reported on Dec. 15 that a deal with Strategic Sports Group was imminent. The SSG group includes Tom Werner and John Henry (Boston Red Sox), Mark Attanasio (Milwaukee Brewers), Arthur Blank (Atlanta Falcons), Wyc Grousbeck (Boston Celtics), Steve Cohen (New York Mets), Tom Ricketts (Chicago Cubs) . and others.
Strategic Sports Group would be a minority investor in PGA Tour Enterprises, and the PGA Tour would remain the majority shareholder.
Meanwhile, the PGA Tour continues negotiations to finalize a deal with Saudi Arabia's Public Investment Fund (PIF) and the DP World Tour, which could potentially inject billions of additional dollars into PGA Tour Enterprises, according to reports. sources.
The PGA Tour, the DP World Tour and the PIF signed a framework agreement on June 6 to consolidate their commercial assets, including the LIV Golf League. The deal was set for Dec. 31, a deadline that was extended as the parties continued to iron out the final details. Monahan and PIF Governor Yasir Al-Rumayyan reportedly met in Saudi Arabia last week.
The PGA Tour Board of Directors held meetings ahead of this week's AT&T Pebble Beach Pro-Am in California. The PGA Tour Player Advisory Council is scheduled to meet via conference call Wednesday morning. Rory McIlroy, who resigned from the PGA Tour's political committee in November, told reporters Tuesday that a deal with SSG appears imminent.
“I know they were supposed to vote Sunday night, and there was a delay,” McIlroy said Tuesday. “They were supposed to vote on this last night, and there was a delay. I feel like this thing could have been finished months ago. I think, just for all of our sakes, more The sooner we get out of the woods and have a path forward, the better.”
A portion of SSG's investment will be used to provide golfers with equity in the newly formed company, which would have an overall valuation of approximately $12 billion if the PIF deal was also finalized. In a memo to members in November, Monahan provided details on the potential share of capital for golfers who remained loyal to the tour.
“Tour management designed a program that would align the interests of our members with the business activities of the Tour through direct equity participation in PGA Tour Enterprises,” Monahan’s memo said.
“As we secure outside investment, this would be a unique offering in professional sports, as no other league grants its players/members a direct equity stake in the league's operations. We recognize — as do all potential minority investors who are in dialogue with us — that the PGA Tour will be stronger with our players more closely aligned with the company's commercial success.”
The PGA Tour's proposed alliance with the PIF and DP World Tour has already attracted the attention of Congress and the Antitrust Division of the U.S. Department of Justice.
The future of LIV Golf, which has continued to poach players from the PGA Tour in recent months, including Masters champion Jon Rahm and Englishman Tyrrell Hatton, is one of the sticking points in negotiations with the PIF. The Saudis have insisted that team golf remains part of the sport's future, according to sources.
