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A trove of documents detailing how the biggest merger in golf history came together is raising antitrust flags as PGA officials defend their agreement before lawmakers for the first time.
Newly released email communications, WhatsApp messages, internal chats and memos involving golf officials unearthed by a Senate investigation ahead of Tuesday’s hearing show discussions dating back to late last year.
The documents, released for the first time as the hearing started, detail how upstart LIV Golf promised to stop poaching top golfers and competing against PGA Tour sponsored events in exchange for a say in sports governance and a share in future media rights.
The initial overtures were made to PGA board member Jimmy Dunne by a British businessman at the behest of Saudi Arabia Public Investment Fund chief Yasir Al-Rumayyan. Dunne, who helped negotiate the agreement, and PGA Tour Chief Operating Officer Ron Price began testifying Tuesday before the Senate Permanent Subcommittee on Investigations in the first of a series of promised hearings as lawmakers dig into concerns about the proposed tie-up.
“We still don’t know how much money is on the table, or was even discussed to prompt the PGA Tour to make this sudden, dramatic reversal,” said panel Chairman Richard Blumenthal, a Democrat from Connecticut, during the hearing. “Americans very simply deserve to know what this agreement means for the future of golf, as well as for the future of the Saudi Arabian government investment in sports and other autocratic regimes that may choose to do the same.”
Lawmakers have demanded investigations into the unexpected merger between PGA Tour and LIV Golf over antitrust concerns. The Justice Department, which is closely watching the hearing today, according to a person familiar with the matter, was already investigating PGA over antitrust concerns. The scrutiny is likely to focus on player compensation and changes to any sponsorships, antitrust experts said after the deal was announced.
During the hearing, Price downplayed the role LIV golf will have in the agreement and justified the deal as one that ended a brutal legal battle between the two leagues.
“Instead of losing control of the PGA tour, an American institution and tradition, we pursued a peace,” Price said. “The framework agreement contains important safeguards that ensures the tour will operate fundamentally as it does today.”
‘The Best of Both Worlds’
Details into how the proposed deal came together were revealed in an April 26 presentation entitled “The Best of Both Worlds,” prepared by bankers for PIF, LIV’s biggest backer. It proposed “cooperation and joint governance” including a split of media rights between the tours. The presentation was created by PCP Capital Partners, an adviser to Saudi Arabia’s PIF, after a meeting between the rival tours in London.
“LIV has been requested by the PGAT/European Tour to stop their players being poached once” terms are agreed, according to the presentation. LIV also promised that its “tournaments are to not compete with” PGA’s events.
The fund’s initial proposal would require top-ranking PGA golfers Tiger Woods and Rory McIllroy to own LIV Golf teams and participate in at least 10 LIV Golf events.
One email shows a potential side deal sought by the PGA that would have pushed LIV CEO Greg Norman out of the Saudi-backed upstart.
By June, a memo with talking points for PGA Commissioner Jay Monahan for a meeting with the tour’s board members before the June 6 deal announcement highlighted that Norman would be given an advisory role by PIF after the PGA takes on the management of LIV Golf.
The PIF presentation also suggested reorganizing the PGA, currently a tax-exempt non-profit. As currently structured, PGA takes in money from sponsors and broadcasters including Comcast Corp.’s NBC, Walt Disney Co.’s ESPN and Paramount Global Inc., and uses it for the tour’s operating costs and paying players, the presentation said.
Under the new proposal, once the PGA Tour’s costs were recouped, any “excess profits” would be paid out via a royalty to a new PIF-owned media company, the presentation said. The PGA Tour brought in revenue of $1.6 billion in 2021, with the bulk coming from media rights, according to the group’s most recent filing.
Connecting Over Golf
Before PGA and PIF officials had meetings to begin negotiating in full swing in April, Roger Devlin, who’s the Chairman of a UK-based public housebuilding company Persimmon PLC, sent an email that popped into Dunne’s inbox in early December. Al-Rumayyan and Amanda Staveley, the British businesswoman known for helping the Saudi fund acquire a stake in England’s Newcastle United Football Club, had “invited” him “to help find a solution to the issues that divide LIV and the PGA,” Devlin, who also chairs England’s elite Sunningdale Golf Club, wrote.
Devlin pitched the idea of exploring a partnership between the circuits, conveying that Al-Rumayyan “was happy to explore a new combined management structure whereby LIV and the PGA might work in partnership especially in respect of media rights.” The fund’s chief was also open to compensating PGA players who turned down offers from LIV by setting up “a substantial Equalisation Fund for their benefit,” while LIV players would be allowed back to play in PGA tournaments, he said.
Dunne eventually reached out to Al-Rumayyan on WhatsApp in April that led to a meeting in London and subsequent talks with Monahan and other officials on both sides of the Atlantic before the deal was announced. Investigators couldn’t determine if Devlin’s outreach or other reasons motivated Dunne to text Al-Rumayyan, according to a memo released by the panel.
The documents show Dunne and Al-Rumayyan’s love for golf helped them connect. As they were discussing dates for their first meeting, Dunne implied they could meet over a game of golf by saying: “No extra shot for you and don’t bring a doctor note!!!” referring to a physician’s letter that allows golfers to use golf carts to traverse holes across a golf course. Dunne ended the message with a three-leaf clover emoji, a symbol of good luck.
Former AT&T Chairman Randall Stephenson, a member of the PGA Tour’s 10-person policy board, resigned Sunday after expressing serious concerns with the LIV deal.
