Mergers, Acquisitions and Divestitures

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      For PGA Tour Players, Betrayal and Confusion in Saudi Deal’s Wake

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      Members of America’s most famous golf tour thought they had a voice. Then came a surprise pact that could reshape the sport for years to come.The U.S. Open winner Gary Woodland had lately sensed something different in professional golf.Players were empowered and emboldened. Executives were listening. The PGA Tour was changing. With the circuit’s dominance challenged by LIV Golf, an upstart built with billions of dollars from Saudi Arabia’s sovereign wealth fund, the tour felt closer to a cooperative than a dispassionate titan of professional sports.Then came the tour’s surprise announcement on June 6 that, after it had lobbied players to forsake the Saudi money it had associated with human rights abuses, the PGA Tour and the wealth fund would join forces. None of the five players who sit on the tour’s board learned of the deal more than a few hours before it became public.“It was turning toward players being heard over the last year,” Woodland, who became a professional golfer in 2007, said at the Los Angeles Country Club, where the U.S. Open will conclude on Sunday. June 6, he said, showed that the voices of tour players had suddenly been “thrown out the door a little bit.”Woodland is not an outlier. In interviews and during news conferences at the Open, top players described a shaken faith in a PGA Tour they believed had recently offered them more meaningful agency and greater influence. The tour’s ability to ease the restive atmosphere could influence whether the deal, which is facing significant skepticism inside the tour and in Washington, advances in the coming months.Compared to other prominent professional sports leagues in the United States, the PGA Tour, a tax-exempt nonprofit, has an unusual structure.Unlike in, say, the N.B.A. or the N.F.L., there are no team owners, and there is no labor union. Instead, players are independent contractors who earn eligibility for PGA Tour membership. Tour members do not generally have financial guarantees — they may, however, earn money through assorted sponsorships — but receive tour paychecks tied to their on-course performances. (When Viktor Hovland won the Memorial Tournament this month, he earned $3.6 million of the event’s $20 million prize fund. Golfers who did not play well enough to secure places in the final two rounds collected nothing.)In return for access to tour events and purses, players allow the circuit to negotiate television rights deals on their behalf, among other conditions. Even without a labor union, players theoretically have a say in tour operations: The 11-member board includes five seats for players, and there is a 16-player council that “advises and consults” with board members and the tour’s commissioner, Jay Monahan.But when tour leaders negotiated a framework agreement to reshape the sport in the most consequential ways since the modern tour’s founding in the 1960s, players were not in the room. Rory McIlroy, the world’s third-ranked golfer and a member of the tour’s board, learned of the deal a week after it was signed behind closed doors at a Four Seasons hotel in San Francisco.Deepening the turmoil, the tentative deal makes little about the future clear, mostly because lawyers and executives are still haggling over the fine print that stands to determine much about how the sport will be organized, funded and operated.“It’s just not easy as a player that’s been involved, like many others, to wake up one day and see this bombshell,” Jon Rahm said.Marcio J. Sanchez/Associated Press“I think the general feeling is that a lot of people feel a bit of betrayal from management,” said Jon Rahm, the winner of this year’s Masters Tournament.“It’s just not easy as a player that’s been involved, like many others, to wake up one day and see this bombshell,” he added. “That’s why we’re all in a bit of a state of limbo because we don’t know what’s going on and how much is finalized and how much they can talk about, either.”The sense of duplicity, some players suggested, might not be so severe had they not grown confident in the notion that they were increasingly central to developing the tour’s path for the years ahead.As Tiger Woods receded from golf’s spotlight, Woodland observed, players found their sport searching for figures to help set its tone and direction.“When I first started, you just went out and played and who knows what was going on,” said Woodland, who remains close to Woods. “It was pretty much everyone jumped on Tiger’s coattails and we just went.” More recently, Woodland said, “guys are starting to get a little more of their own voice, and you’re starting to see different opinions.”Faced with the rise of LIV Golf, players had helped devise changes to the tour’s format and schedule. During a private meeting in Delaware last summer they tried to hash out adjustments that could help curb an exodus to LIV. Afterward, Monahan declared that the Delaware meeting “represents a remarkable moment for the PGA Tour and showcases the essence of what being a membership organization is all about.”By the middle of last month, though, Monahan was in Venice for secret talks with Yasir al-Rumayyan, the governor of the Saudi wealth fund. Two board members, neither of them players, were on the trip to Italy. The men later gathered in San Francisco over Memorial Day to finish up the framework deal. Afterward, the circle of people who knew about the planned partnership expanded, but did not include any players until June 6, when tour and Saudi officials announced the pact. Some players learned about it on Twitter.The mood inside the tour only worsened as it became apparent that the deal had been constructed in extraordinary secrecy, with players’ representatives on the board shut out of the talks.Joel Dahmen said he recognized that voices of midlevel players like him would receive only so much priority in the tour’s strategic deliberationsEtienne Laurent/EPA, via Shutterstock“We were given the impression that we were being heard,” said Joel Dahmen, a professional player since 2010 whose public profile soared this year when he appeared in the Netflix documentary series “Full Swing.”Dahmen, a self-described “midlevel” guy, said he recognized that voices like his would receive only so much priority in the tour’s strategic deliberations. But many golfers were flabbergasted that even its greatest headliners were kept away from the negotiations, even as some of their colleagues said they understood that it was impractical to expect tour officials to confer with the entire membership in advance.“If you have to consult every player, then probably nothing’s ever going to happen, and that’s the balance for any organization,” said Adam Scott, the 2013 Masters winner and former world No. 1 player who chairs the tour’s Player Advisory Council. “It’s like the golf club at home: They’ve got the members’ committee, and a few on that committee get to influence decisions.”“It’s a player-centric tour,” Scott added, “but it depends where you’re sitting and how you look at things.”PGA Tour officials have rushed to quell the outrage, mindful that frustrations with the organization helped prepare the ground for LIV to entice players away from what is America’s flagship men’s golf circuit. Senior executives have been at the U.S. Open, and Monahan, who began a leave of absence this past week after what the tour described only as “a medical situation,” held a contentious meeting with players hours after the deal’s announcement.Players with some of the closest ties to Monahan and other executives said they had received a barrage of feedback unlike any they recalled. Webb Simpson, a board member who won the 2012 U.S. Open, said, perhaps with a dose of hyperbole, that he had probably heard more from players since June 6 than he had in his 15 years as a tour golfer.“We want to have unity, but we also want to trust our leaders,” said Simpson, who added that he had been calling players to hear out their misgivings and aggravations. “I think as a whole they are struggling with these decisions.”“It’s a player-centric tour,” Adam Scott said, “but it depends where you’re sitting and how you look at things.”Richard Heathcote/Getty ImagesAlthough McIlroy has signaled his support for the deal, other players with board seats have been publicly noncommittal.“I told myself I’m not going to be for it or against it until I know everything, and I still don’t know everything,” Simpson said.He sounded much like Patrick Cantlay, another board member, who said that “it seems like it’s still too early to have enough information to have a good handle on the situation.”The board is scheduled to meet later this month, but it is not clear whether the pact will be ready for a vote by then. At the very least, board members are expecting a briefing that might allow them to answer more detailed questions about the tour’s future.All players can do for now, many said, is to try to imagine what the tour might look like and where they might fit into a changed ecosystem.“Where I think I am — and a lot of other players are — is we’re going to show up at the biggest and best events that we have tee times at, the ones that pay the most money, and we’re going to go play until someone tells us we can’t play in those events anymore, and then we’ll go find other events,” Dahmen said.They are also settling in for a protracted period of uncertainty, grappling with the possibility that the tour could be in turmoil for another year or more. It is an unfamiliar road for many of them, after all of these years in which the tour was the unquestioned destination of choice for many of the world’s top golfers, its business model familiar.“As members or as players,” Scott said, “we haven’t had to deal with anything like this before.” More

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      PGA Tour and LIV Golf Seek to Drop Litigation Against Each Other

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      Although the tour’s deal with the Saudi wealth fund has not closed, the request to a federal judge was a milestone in golf’s surprise détente.The PGA Tour, LIV Golf and Saudi Arabia’s sovereign wealth fund asked a federal judge in California on Friday to dismiss the litigation that catapulted golf’s economic and power structure into the American court system.The request to dismiss the case with prejudice, meaning that it cannot be refiled, came less than two weeks after the tour and the wealth fund, which bankrolled LIV, announced a tentative agreement to form a partnership. Although the deal may not close for months and faces mounting scrutiny in Washington, Friday’s submission in Federal District Court in San Jose, Calif., was a milestone in the abrupt détente between the rival circuits.Judge Beth Labson Freeman, who has been overseeing the case, is expected to approve the request, a cornerstone of the tentative agreement between the tour and the wealth fund. By abandoning the litigation, LIV, the PGA Tour and the wealth fund are limiting the potential for damaging revelations and surging legal bills, as well as closing off one avenue for recourse if the new alliance falls apart.Justice Department officials, who were already conducting an antitrust inquiry into men’s professional golf, are expected to review the deal closely and could even try to block it or compel changes to it. At least two Senate panels are demanding information about the planned transaction and its consequences, and the deal has not even secured the approval of the PGA Tour’s board.Much about the agreement itself also remains in flux, including the valuations of the assets of the tour, LIV and the DP World Tour, formerly the European Tour, that are to be housed inside the new for-profit venture. The tour’s commissioner, Jay Monahan, is expected to serve as the company’s chief executive, and Yasir al-Rumayyan, the wealth fund’s governor, is poised to be its chairman. The PGA Tour expects to hold a majority of the seats on the new company’s board, but the wealth fund will have extensive power over how it is bankrolled, assuring the Saudis of significant influence.Until June 6, when the deal was announced, the PGA Tour had warned against allowing Saudi money and influence to take hold in golf, fueling California litigation that had a costly, complicated life.The acrimonious proceedings began last August, when 11 LIV players, including the major tournament champions Phil Mickelson and Bryson DeChambeau, brought a lawsuit that accused the tour of violating antitrust laws. LIV itself joined the case later that month.The tour also pursued its own claims against LIV, which it said had improperly interfered with existing contracts with players. The tour later received Judge Freeman’s approval to expand its case to include the wealth fund itself and al-Rumayyan, just one of the rulings that placed pressure on the Saudis and their allies, whose superior financial resources put the tour under immense strain.The tour, the wealth fund and LIV waged a ferocious battle over evidence collection in the case, and many filings in the case were redacted, but a federal magistrate judge concluded this year that the wealth fund was “the moving force behind the founding, funding, oversight and operation of LIV,” undercutting its contention that it was a passive investor in golf.A trial had not been expected until at least next year.Hours before Friday’s filing from the tour and LIV, The New York Times filed a motion that asked the court to unseal records in the case. The Times cited a “substantial and legitimate public interest in these proceedings and their outcome” and suggested that the planned partnership could make concerns of competitive harm moot.“To the extent that competitive harm existed at the time of sealing, those justifications may not apply with the same force today — or upon completion of the parties’ anticipated merger,” The Times’s filing said. “Sealing is a decision that can and should be revisited as facts change and circumstances require.”It was not clear when the judge would rule on either of Friday’s motions. More

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      Michael Jordan to Sell Majority Stake in Charlotte Hornets

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      Jordan, the former star of the Chicago Bulls, purchased the team in 2010.Michael Jordan, the owner of the Charlotte Hornets and one of the most storied athletes in sports history, has agreed to sell his majority share in the team to a group led by Gabe Plotkin and Rick Schnall, two private equity investors.The team was valued at $3 billion, according to a person familiar with the details of the agreement but not authorized to discuss them publicly. The team, in its announcement of the sale, did not disclose what percentage of his stake Jordan would sell, but said he would remain a minority investor. Jordan, a North Carolina native, first purchased the team in 2010 for $275 million, when the team was known as the Bobcats.The acquiring group also includes the country music star Eric Church and the rapper J. Cole, both of whom are from North Carolina.Jordan won six championships with the Chicago Bulls in the 1990s and is considered by many to be the greatest basketball player ever. More

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      The Titanic PGA and LIV Golf Deal Stokes Anger on Capitol Hill

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      American lawmakers and officials are studying the pact between the PGA Tour and Saudi Arabia’s sovereign wealth fund.One of golf’s greatest tests will unfold starting on Thursday, when the U.S. Open begins at the Los Angeles Country Club. It might be an easier lift — it will assuredly be a shorter one — than the test that is emerging in Washington.The abrupt announcement last week that the PGA Tour will tie itself to Saudi Arabia’s sovereign wealth fund and its LIV Golf league is provoking American officials in ways as predictable as they might be persistent in the months ahead.Antitrust experts are insisting that the Justice Department should consider suing to stop the agreement, which calls for the business operations of LIV and the PGA Tour to be brought into one new company, if the deal closes in the coming months. Lawmakers are complaining that the Florida-based PGA Tour is lurching into business with an arm of the Saudi state that it roundly condemned until last week. Political strategists are scrambling to shape perceptions of an agreement that was forged in secret and, upon its release, promptly criticized as a well-heeled exercise in hypocrisy and whitewashing.Whether the commotion will amount to anything beyond a few news cycles of fussing — a successful assault on the PGA Tour’s tax-exempt status comes to mind — may not be clear for months. But a week into golf’s latest maelstrom, a deal that could eventually prove lucrative for players and executives is already promising a booming era for lawyers, lobbyists and political sound bites, too.Although golf had been under pressure inside the Justice Department, where antitrust regulators were looking at the PGA Tour, the announcement last week brought the tumult to Capitol Hill.In the House, Representative John Garamendi, Democrat of California, swiftly introduced a bill to revoke the PGA Tour’s tax-exempt status. And in the Senate, Senator Richard Blumenthal, Democrat of Connecticut, announced on Monday that a subcommittee he chairs would conduct an inquiry into a deal that he said “raises concerns about the Saudi government’s role in influencing this effort and the risks posed by a foreign government entity assuming control over a cherished American institution.”At the U.S. Open in Los Angeles this week, PGA Tour golfers like Jon Rahm will be playing with men like Sergio Garcia, who defected to LIV last year.Richard Heathcote/Getty ImagesThat there would be a battle was never much in question. The principal short-term matter to resolve was who, exactly, would be picking which fights.The golf side of the battle features two forces with formidable records across decades in Washington. Even though Saudi Arabia has had plenty of bipartisan tangles, the kingdom’s officials and allies have often enjoyed an uncommon rapport with their American counterparts, as was on display during a visit from Secretary of State Antony J. Blinken last week. And the PGA Tour has usually found the capital to be a wellspring of courtesy, especially when its supporters helped short-circuit a Federal Trade Commission inquiry in the 1990s.The trouble for the wealth fund and the tour is that Washington also has a bipartisan affection for lawmakers imitating sports executives, and browbeating actual ones, in public and in private. It can be good politics to glower at the commissioners who draw more jeers than many elected officials, and headline-making hostility from Congress could complicate the golf industry’s quest to sell the deal to the public — and then move past it.The tour and the wealth fund can take some comfort in history, which suggests a successful congressional effort to thwart the deal directly is unlikely. The Hill, though, could still seek to make the transaction painful beyond a feisty public hearing or two. A change to the tour’s tax status, like the one envisioned in the bill introduced in the House, could cost it millions of dollars a year because it has been structured as a “business league” that is exempt from taxes under section 501(c)(6) of the Internal Revenue Code.Groups like the PGA Tour have combated legislative headaches surrounding their tax-exempt status in the past, with one effort to end the practice for sports leagues vanishing from a 2017 tax bill at the last moment. In the past 18 months, years after the N.F.L. and Major League Baseball surrendered their exempt statuses, public records show that the tour has spent at least $640,000 on lobbying, with much of that work tied to “tax legislation affecting exempt organizations.”As a part of his inquiry, Blumenthal on Monday demanded documents related to the tour’s tax-exempt status and, in his letter to the tour, wondered whether the deal would allow a foreign government to “indirectly benefit from provisions in U.S. tax laws meant to promote not-for-profit business associations.”Senator Ron Wyden, Democrat of Oregon, who is chairman of the Senate Finance Committee, similarly seethed that the tour had “moved itself right to the top of the leaderboard in terms of most questionable tax exemptions in professional sports.”But Wyden has also suggested that the deal should run into resistance before the Committee on Foreign Investment in the United States, a Treasury Department-led committee that examines national security implications of foreign investments in real estate and American companies.Whether there are serious national security concerns about a deal involving golf tours, or whether the committee will even review the agreement at all, is unclear. Janet Yellen, the secretary of the Treasury, said last week that it was “not immediately obvious” to her that the agreement related to national security. But Wyden, who is planning a congressional investigation of his own, has signaled his interest in the department’s exploring whether the deal could give “the Saudi regime inappropriate control or access to U.S. real estate,” most likely through the tour’s Tournament Players Club collection of golf courses.And those are just the spats that have erupted since last Tuesday.The PGA Tour commissioner, Jay Monahan, left, and Jimmy Dunne, a board member, were closely involved in the merger negotiations.Getty ImagesUrged on by LIV’s lawyers, Justice Department regulators have spent months examining whether the PGA Tour’s tactics to discourage players from defecting to the Saudi-backed league were illegal, and whether the tour’s coziness with other leading golf organizations — like Augusta National Golf Club, the organizer of the Masters Tournament — violated federal law. Instead of quieting misgivings about golf, the deal has only intensified them and might have even armed the department with a new lever: suing to stop the pact, which the tour and wealth fund deny amounts to a merger.“Generally, we want to encourage parties to settle their disputes outside of the judicial process, but it doesn’t mean that settlements are immune from antitrust,” said Henry J. Hauser, a former antitrust lawyer at the Justice Department who now practices at Perkins Coie, one of the capital’s best-connected firms. “If companies try to resolve a legitimate dispute by agreeing to common conditions that stifle competition, that could be a problem.”The Justice Department has declined to comment.The tour is moving aggressively to curb Washington’s irritation, going as far to suggest that Congress and other parts of the federal government could have done more to help it rebuff a Saudi challenge.“While we are grateful for the written declarations of support we received from certain members, we were largely left on our own to fend off the attacks, ostensibly due to the United States’ complex geopolitical alliance with the Kingdom of Saudi Arabia,” the PGA Tour commissioner, Jay Monahan, wrote in a letter to lawmakers last week. “This left the very real prospect of another decade of expensive and distracting litigation and the PGA Tour’s long-term existence under threat.”In the penultimate sentence of his letter, Monahan described the tour as “an American institution,” just as Blumenthal would on Monday. But like many executives before him, Monahan is finding that Washington is forever eager to scrutinize American institutions, especially when sports are involved.He may ultimately find that the shouting has only just begun.Lauren Hirsch More

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      Matt Fitzpatrick and Cameron Smith Don’t Know What’s Next After The LIV-PGA Tour Merger

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      “I just don’t know what’s going on,” Fitzpatrick, the reigning U.S. Open champion, said Monday of the PGA Tour’s merger with LIV Golf. “I don’t think anyone knows what’s going on.”A year ago at the U.S. Open, the field was distracted by an entirely new phenomenon in men’s professional golf: Several players who had turned their backs on the PGA Tour to defect to the insurgent LIV Golf circuit would, for the first time, be competing against their former brethren.Golfers had chosen sides in a sport known for individualism, fueling an unfamiliar team-against-team tension.Twelve months later, and days after the seismic news of the American and European tours forming a partnership with LIV Golf, the disruption at the 2022 U.S. Open now seems like an almost inconsequential diversion. Just ask Matt Fitzpatrick, who won that tournament in Brookline, Mass., for his first victory at a major tournament win and also on the PGA Tour.“I seem to remember last year just thinking about the tournament, just the U.S. Open,” Fitzpatrick said on Monday. “It was easier for me to mentally focus on that and be in a better place than obviously all this confusion that’s going on this week.“The whole thing is confusing.”Asked to elaborate on what he found most confusing, Fitzpatrick could not help but chuckle.“Well, I think I just don’t know what’s going on,” he answered. “I don’t think anyone knows what’s going on.”Fitzpatrick mentioned the Saudi Public Investment Fund, known as PIF, whose staggering riches have backed LIV.“Are we signing with the PIF, are we not signing with the PIF? I have no idea,” he said, adding: “It’s pretty clear that nobody knows what’s going on apart from about four people in the world.”To prove that disorientation was universal across golf, Cameron Smith, who joined LIV not long after winning last year’s British Open, followed Fitzpatrick into the interview room at the Los Angeles Country Club and essentially admitted he was clueless as to what was coming next in his chosen occupation.Smith might rate as something of an insider since he at least received a phone call from Yasir al-Rumayyan, who oversees the PIF and would be the chairman of the new company formed by combining the tours, about the blockbuster deal announced last week.It was a good thing al-Ruymayyan called because Smith said his first reaction to the news was that, “it was kind of a joke.” But al-Rumayyan informed Smith otherwise — without much detail.“He didn’t really explain too much,” Smith said. “I think there’s still a lot of stuff to be worked out, and as time goes on, we’ll get to know more and more. I think he was calling a few different players, so the call was kind of short and sweet.”Despite a lack of clarity about the future of professional golf, both Fitzpatrick and Smith were nonetheless asked about two hot topics since the PGA Tour-LIV deal was announced.For Fitzpatrick, there was the question of whether he thought players, like himself, who were loyal to the PGA Tour should be compensated for turning down the gobs of money LIV was offering.At first, Fitzpatrick appeared ready to address the issue, which is perhaps the most charged and dicey detail to be hammered out in the coming weeks or months. But then Fitzpatrick paused. And paused. He smiled and then exhaled. His eyes roamed the room. Finally, he said with a thin smile: “Yeah, pass.”Fitzpatrick last Friday at the Canadian Open, where he finished eight under for the tournament in a tie for 20th.Minas Panagiotakis/Getty ImagesSmith was asked if he had been given any indication that the LIV tour would continue to exist after this year. He replied: “I really know as much as you guys know, to be honest. I haven’t been told much at all. I guess if anything comes up, I’ll let you guys know.”He refused to answer a question about whether he would want to return to the PGA Tour if LIV was dissolved after this season, calling it “hypothetical.”But he added: “I think I’ve made the right decision anyway. I’m very happy with where I’m at. I obviously made that decision for a few different reasons. Like I said, I know as much as everyone else, and it’s going to be interesting to see how the next few months, maybe even year, kind of plays out.”Smith’s attitude was jovial, which matched the mood of several LIV players who slapped hands with each other and smiled on the practice range on Monday.“I haven’t been told much at all, but I’m just taking it as it goes along,” Smith said. “But there’s definitely a lot of curious players, I think, on both sides as to what the future is going to look like.”Fitzpatrick had an eye on the future and also the past, recalling last year’s U.S. Open fondly.“An amazing week,” he said, hoping to rekindle the magic he discovered.But then, so much has changed in a year. On Monday, there remained one question above all the others. What next for golf?Fitzpatrick shook his head.“I’ll be completely honest, I literally know as much as you,” he said. “I’m sure everyone has gotten questions about it. I found out when everyone else found out. Yeah, honestly, I know literally nothing.” More

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      Senate Opens Inquiry Into PGA Tour Deal with Saudi-Funded LIV Golf

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      The PGA Tour and LIV have been asked to provide documents and communications tied to the agreement announced last week.The PGA Tour and LIV Golf have not yet closed a stunning partnership agreement announced only last week, but vows from Washington to slow or stop the deal — or at least make it uncomfortable for golf executives — crystallized on Monday, when the Senate opened an inquiry into the arrangement.Senator Richard Blumenthal, Democrat of Connecticut and the chairman of the chamber’s Permanent Subcommittee on Investigations, said Monday that he had demanded that both the PGA Tour and the Saudi Arabian-funded LIV give up a wide array of documents and communications tied to the agreement. Blumenthal also asked for records related to the PGA Tour’s nonprofit status, suggesting an appetite to challenge the tour’s tax-exempt standing.In a statement issued three days before the start of the U.S. Open in Los Angeles, Blumenthal decried Saudi Arabia’s “deeply disturbing human rights record at home and abroad” and said the agreement raised concerns “about the Saudi government’s role in influencing this effort and the risks posed by a foreign government entity assuming control over a cherished American institution.”LIV declined to comment on Monday. In a statement on Monday afternoon, the PGA Tour said it was “confident that once Congress learns more about how the PGA Tour will control this new venture, they will understand the opportunities this will create for our players, our communities and our sport, all while protecting an American golf institution.”Congress cannot block the agreement simply by opening an investigation, and any legislation to derail the deal would almost certainly provoke a court challenge. But congressional scrutiny and, perhaps, public hearings could tarnish the deal and make the months ahead even more unpleasant for the leaders of professional golf.Blumenthal has shown a willingness to spar with sports executives. Lately, he has pressed American universities for information about their sports betting partnerships, and he has lashed the N.C.A.A. leadership for years over conditions for college athletes.Although the planned deal has caused some heartburn and saber-rattling on Capitol Hill, Congress has not shown unanimous interest in haranguing golf leaders over it. Senator Ron Johnson, the Wisconsin Republican who is the ranking minority member on the panel that Blumenthal chairs, said last week that Congress should stay out of sports.The PGA Tour’s agreement with the Saudi Public Investment Fund, whose LIV circuit made its debut last year, would bring the business dealings of the rival tours into a new company. The PGA Tour commissioner, Jay Monahan, is in line to serve as its chief executive, and Yasir al-Rumayyan, the wealth fund’s governor, will be its chairman.Under the terms of the agreement, the Saudi wealth fund will have exclusive rights to invest in the new company, positioning it for significant influence over golf’s financial future. PGA Tour officials have insisted, to widespread doubts, that they will be the ultimate decision makers because their allies will hold a majority of the new company’s board seats.Professional golf attracted the gaze of Washington regulators before last week’s announcement. Antitrust investigators from the Justice Department have spent months asking questions about the tour’s efforts to deter player defections to LIV and examining whether the tour’s top leaders were too close to other prominent golf organizations, like Augusta National Golf Club, the organizer of the Masters Tournament.The department has brought no public allegations of wrongdoing and has not commented on last week’s announcement of a deal. But antitrust experts have warned that the department is virtually certain to study it closely and may even step in to try to block it.Tour executives have expressed confidence that the agreement will withstand any legal challenges. More

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      How Will Jay Monahan of the PGA Tour and Yasir al-Rumayyan Work Together?

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      The stunning golf merger announced last week has raised many questions, and one big one is how will the Saudi wealth fund boss and the tour commissioner manage to work together?After more than a year of high-stakes jockeying and long-distance accusations, Jay Monahan and Yasir al-Rumayyan finally met in May, an arranged blind date in some Venice cafe or hotel.Now the oddest of bedfellows will attempt to remake the future of professional golf and repair the damage done by a yearlong civil war they had once waged against each other.The 53-year-olds in charge could not be more different: Monahan, the American commissioner of the PGA Tour since 2017, and al-Rumayyan, the trusted confidant of Saudi Arabia’s Crown Prince Mohammed bin Salman and overseer of his country’s massive Public Investment Fund.It is that fund, claiming to be worth somewhere close to $700 billion, that bought its way into golf last Tuesday. It ended a sniping, court-complicated fight between the PGA’s American and European tours and the Saudi-backed LIV Golf tour. It instantly solved the PGA Tour’s financial struggles.Now al-Rumayyan will be chairman of this entity. Monahan will be his chief executive. And among the many complex questions this raises is one of internal logistics. How will this unlikely duo manage — manage the game of golf, both on the course and off it, and manage to get along?“Money can change everything,” the legendary golfer Gary Player said in an email exchange. “And all we can do now is hope the outcome moving forward is positive for all.”Monahan has deep New England roots and a background in sports marketing. His leadership style is as hushed as a golf crowd awaiting a winning putt.“I enjoy all forms of human interaction,” he told Golf Digest in 2017. “Talking with people, listening to them, often just observing them. Even unpleasant people, I enjoy discovering what makes them tick. It’s sort of a requirement of the job I’m in now because the range of people is so broad, their situations so dynamic. Their needs and goals can be material, but it’s the human interaction that gets us there.”Al-Rumayyan, the cash-carrying disrupter with a deep passion for golf, is a stern test for Monahan’s people skills. Certainly his “needs and goals” are material.While al-Rumayyan will hold just one of the (now) 11 seats on the PGA Tour board of directors, he and the wealth fund have the exclusive right to invest in the new entity. That means they control the finances, and they plan to pump in billions of dollars.Yasir al-Rumayyan and Monahan sat side by side during an appearance on CNBC.CNBCIn his only public appearance since the merger was announced last week, a televised consummation on CNBC where the two sat chummily side by side, al-Rumayyan said he would let Monahan lead the operation.The “voting system” and the majority of the board, he noted, “is not going to be with us.”But al-Rumayyan’s very presence — and the deal itself, for now only a framework that could take months to formalize — is a heavy reminder that money can trump it all.“The Saudis will want to dominate this,” said James M. Dorsey, adjunct senior fellow at the S. Rajaratnam School for International Studies in Singapore. “They don’t like to play second fiddle. And they believe, not without reason, that money talks.”What kind of takeover leader al-Rumayyan will become is unclear. His PIF portfolio is massive, and he chairs dozens of state-owned firms, including the oil giant Saudi Aramco and the mining firm Ma’aden. He largely lets executive teams run them as they see fit.But the relationship with Newcastle United, the English soccer team, might provide the best clues for golf.The PIF bought an 80 percent share of Newcastle United in 2021. Fans of the English club immediately welcomed the ownership change, as the prospect of on-field success overrode hard questions. Infused with PIF money, doled out by al-Rumayyan, Newcastle has surged toward the top of the English Premier League.At Newcastle, he has left day-to-day decisions to others, though he has quickly approved expenditures for talent upgrades and has not been invisible.He shows up to matches on occasion. (Compare that with mostly absentee ownership of Manchester City by Sheikh Mansour bin Zayed al-Nahyan of the United Arab Emirates, who made news on Saturday by going to the team’s Champions League final.) He has kicked the ball around the team’s field and been photographed in the dressing room.Al-Rumayyan with the Newcastle players, coaching staff and families after they qualified for the Champions League.Scott Heppell/ReutersYet al-Rumayyan is more passionate about golf. Around LIV, his pet project, he is known as H.E., for His Excellency, and has been a considerable public presence. At last year’s LIV event in Bedminster, N.J., al-Rumayyan hobnobbed with former President Donald J. Trump, the course’s owner. For a time, al-Rumayyan wore a “Make America Great Again” cap.But most do not expect him to be an overtly public presence in golf or a familiar figure around the trophy ceremonies. Part of it is his portfolio; he has plenty of other business responsibilities.“How much time does he have to allocate?” Dorsey said. “This is a man at the top of an empire. He oversees a vast array of things. I think you’ll see a lot of his lieutenants and not a lot of him, at least once this settles down.”Part of it is Saudi culture; he has to “walk a fine line,” according to Kristian Ulrichsen, a fellow for the Middle East at Rice University’s Baker Institute for Public Policy, given the autocratic leadership of Prince Mohammed.“If you seem to be too big, and you seem to be Mr. Saudi Arabia, bin Salman doesn’t take well to people stepping on his toes,” Ulrichsen said. “But we’ve also seen that al-Rumayyan is probably the most trusted and most competent member of his inner circle.”Al-Rumayyan was a little-known banking executive in 2015, when King Abdullah died. Power consolidated around Prince Mohammed, who soon started Vision 2030, an ambitious makeover for Saudi Arabia and its reputation. Part of that involved building the PIF as a diversifying vehicle for growing global capital, financially and culturally.At last year’s LIV event in New Jersey, al-Rumayyan hobnobbed with former President Donald J. Trump.Doug Mills/The New York TimesPrince Mohammed, looking to flush out the aging elite that he felt limited the country’s ambitions — locking up and abusing hundreds of them — handed responsibility of the fund to al-Rumayyan.Continued human rights violations and the murder of the journalist Jamal Khashoggi in 2018, on orders, the Central Intelligence Agency has said, from Prince Mohammed, have made the Saudis global pariahs.But under al-Rumayyan’s direction, the investment fund grew exponentially.Investment in sports, in particular, has proved an effective reputation launderer that some call sportswashing. The culmination of that effort may be the takeover of golf, announced the same week Secretary of State Antony J. Blinken visited Prince Mohammed in Saudi Arabia.“This was part of establishing Saudi Arabia on the global stage,” Ulrichsen said of the Saudi push into international sports. “And in this case, it shows that Saudi Arabia is welcome again at the highest kind of table in the United States, especially after what happened post-2018. That period of isolation is now definitely over.”For Saudis, the golf deal is more a global news event than a national one. Wednesday’s front page of Arriyadiyah, the kingdom’s top sports daily, was dominated by the news of the French soccer player Karim Benzema moving to Jeddah-based Al-Ittihad, the latest prize for the top Saudi league, which already attracted Cristiano Ronaldo, among others. The announcement of the golf merger was nowhere to be found in any of the paper’s pages for that day, and merited only a brief mention on Page 11 on Thursday.But al-Rumayyan is on a one-man mission to use golf for Saudi benefit. He helped establish the Saudi Golf Federation and the Saudi Golf Company, founded in 2019 to promote the game in the country.One uncertainty is the long-term role of Monahan as chief executive. Tax records obtained by ProPublica show that he was paid $14 million in salary in 2021 for his role as PGA Tour commissioner. He spent most of 2022 and early 2023 trying to fend off LIV through insults and lawsuits.That litigation will be withdrawn, saving the cash-poor PGA Tour money while shielding al-Rumayyan and the wealth fund from depositions and discovery.Was it all gamesmanship that can be forgiven now? Or might al-Rumayyan work behind the scenes to find a leader more aligned with his goals?Monahan wants golf fans, sponsors and his own players to resist the reflexive, collective wince at this new arrangement, painted by many as a money-over-morals transaction, and to think of where global golf can be in 10 years.One uncertainty is the long-term role of Monahan as chief executive.Eric Risberg/Associated PressIt most likely depends on whatever al-Rumayyan wants.It could be mere tweaks in payouts, schedules and formats to lift a sagging, traditional enterprise — the way he has handled Newcastle. Or it could be an overhaul. A possible comparison, without ties to the PIF, is the way international cricket introduced Twenty20 to counter dragging, multiday contests with something shorter, livelier and more consumable, which is similar to what LIV has tried to do.For someone like Player, 87, a nine-time major tournament winner from South Africa, the hope is broad, global growth, not just on the PGA Tour.“The women’s game and the weekend golfer should not be forgotten with all this money pouring in,” he said. “Allow the ladies to earn a better living. Use the money to make golf accessible for the masses. Let’s make it a point to share this new era to all who love our sport.”At the heart of all the possibilities, for now, is the relationship between two men — an impossibly rich backer from Saudi Arabia and a tradition-rich sports executive from Massachusetts.“We just sat down, him and I, in Venice for about two hours, trying to understand each other,” al-Rumayyan said. “He talked about his aspirations, his life. I did the same. Even my family was with me in Venice. We had a lunch with a big group of people. The understanding and the positive thinking is what really unites us in growing the game of golf. The passion that we have, both of us, is what really cemented this kind of agreement.”Springtime in Venice has a way of sparking such enchantment.Skeptics may point out that Venice is a series of islands and an easy place to lose your sense of direction. Cynics might note that it is sinking.Ahmed Al Omran More

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      How the PGA Tour-LIV Golf Merger Came Together

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      Jay Monahan, the PGA Tour commissioner, had gone unnoticed in Venice last month.With luck, he thought over breakfast near the Palazzo Ducale, his confidential talks in Italy with Yasir al-Rumayyan, the governor of Saudi Arabia’s more than $700 billion sovereign wealth fund, might stay secret. A leak would endanger what only a handful of insiders knew: that the PGA Tour was considering going into business with al-Rumayyan’s LIV Golf league, whose monthslong clash with Monahan’s tour had become a fight as much over golf’s soul as its future.Then Stefano Domenicali, Formula 1’s chief executive, strolled into view. He was in town for the same wedding that had brought al-Rumayyan to Venice. If the motor sports executive spotted the PGA Tour’s leader, he would assuredly connect the presences of Monahan and al-Rumayyan, and golf’s greatest secret might get out. All Monahan could do, he told people later, was try to dodge Domenicali’s gaze.But Domenicali never seemed to notice him. What would ultimately amount to seven weeks of clandestine meetings and furtive calls stayed hidden until a stunning announcement last Tuesday: The PGA Tour, the dominant force in men’s elite golf for decades, planned to join forces with LIV, the upstart that had provoked debate over the morality of Saudi money in the game.The agreement was a singular moment in the history of the professional game. The civil war that had disrupted and defined the once genteel sport — for example, Monahan once publicly asked whether PGA Tour players had ever felt compelled to apologize for competing on the circuit — was abruptly suspended. The tour’s reputation was stained and many of its loyalists were furious, but its coffers were poised to overflow.The deal, though not yet closed, was also a breakthrough for Saudi Arabia’s ambitions in golf. The culmination of a years-old plan called “Project Wedge,” the agreement gives al-Rumayyan, one of the kingdom’s most influential officials, a seat in the sport’s most rarefied rooms. And for a country that has craved a greater global profile, an economy based on more than oil and a distraction from its gruesome human rights abuses, the agreement was another step in its rapprochement with the West.This account is based on interviews with nine people with knowledge of the negotiations. Most of them spoke on the condition of anonymity to describe the lead-up to an extraordinary transaction — one so closely held that most of golf’s eminent bankers, lawyers and broadcast partners had no warning that it was even being discussed.It was not until this spring that even golf’s most connected power brokers grew confident a deal could happen this year, if ever. But there seemed enough conspicuous pressure points, some much more severe than others, that prodded both sides into secret talks.LIV had enticed some of golf’s most talented and bankable stars, including Brooks Koepka and Phil Mickelson, with contracts that sometimes promised them $100 million or more. The league’s television deal, though, had been meager, and its lawyers had acknowledged that its revenues were “virtually zero.” Federal judges in California added to LIV’s turmoil when they showed limited interest in shielding the Public Investment Fund from the kind of scrutiny it had generally avoided in other court battles in the United States.Brooks Koepka at this year’s Masters tournament, where he tied for second. The LIV golfer won the P.G.A. Championship the following month.Doug Mills/The New York TimesBut the PGA Tour, a tax-exempt nonprofit with an aging audience and a stiff reputation, was in greater peril. As part of a federal antitrust inquiry, Justice Department investigators were asking questions about heavy-handed tactics the tour used to discourage player defections and examining whether tour leaders were too cozy with other powerful golf organizations, like Augusta National Golf Club, the organizer of the Masters Tournament.More precariously, the tour’s efforts to retain the loyalty of players, which included raising prize purses by tens of millions of dollars, were severely straining its finances. The tour’s television contracts had been constructed before it was facing one of the richest conceivable rivals. And the tour’s legal fees had swelled to more than $40 million a year — up more than twentyfold from the start of the decade — as it waged fights some thought could last until at least 2026.Monahan had foretold something like this.“If this is an arms race and if the only weapons here are dollar bills, the PGA Tour can’t compete,” he said last June in Connecticut.Late in the year, the PGA Tour said a veteran deal maker, James J. Dunne III, would join its board, and some involved in the wealth fund wondered whether he would someday emerge as an emissary.He did on April 18, when a WhatsApp message flashed on al-Rumayyan’s phone. The tone toward one of the world’s most influential financiers, a figure often addressed as “Your Excellency” and close to Crown Prince Mohammed bin Salman, was strikingly casual.“Yasir,” Dunne began as he introduced himself and asked to arrange a call and, “hopefully,” a visit. He signed the message with equal informality: “Jimmy.”James J. Dunne III, a veteran deal maker, was named to the PGA Tour’s board late last year.Oisin Keniry/Getty ImagesThe approach, as optimistic and unguarded as men’s professional golf had been tumultuous and tense, led to a conversation within hours. Dunne and al-Rumayyan fast found a point of harmony that would shape the negotiations: Neither man insisted on a nondisclosure agreement.‘Let’s see how that would work.’London was neutral ground, only hours from golf’s birthplace in Scotland. The men decided they would meet there less than a week later, joined by Edward D. Herlihy, the chairman of the PGA Tour’s board. Herlihy was not any ordinary board member; more than a half-century after he earned his law degree, he was a partner at Wachtell, Lipton, Rosen & Katz and one of Wall Street’s most sought-after counselors for mergers and acquisitions.Even without nondisclosure agreements, the men concluded that any prospective deal would have to be weighed in private. Most members of the tour’s board, including Rory McIlroy, one of the world’s most renowned golfers and a ferocious critic of LIV, and the former AT&T chairman Randall Stephenson, would be largely shut out. Greg Norman, the two-time British Open winner who had envisioned something like LIV long before he became its commissioner, would not be at the bargaining table, nor would most of the seasoned bankers and lawyers the two parties had worked with over the years.Rory McIlroy with PGA Tour commissioner Jay Monahan last year. The talks cut out many board members including McIlroy.Erik S Lesser/EPA, via ShutterstockBut the negotiators also knew that an accord would not be reached at the initial gathering in London, in part because Monahan would not be in attendance as some of his allies took stock of the Saudis.In a meeting, and later at dinner and over cigars, Dunne, Herlihy and al-Rumayyan discussed their approaches to golf and their own lives, testing whether their budding rapport would endure across hours of face-to-face conversations.Dunne’s personal history made him an unlikely figure to connect with al-Rumayyan. More than one-third of his investment bank’s employees died in the 2001 attacks at the World Trade Center. Dunne had been out of the office playing golf that Tuesday. More than two decades later, after years of supporting the families of the victims, he was meeting with a senior official from a country many people still accused of having a role in the attacks. But al-Rumayyan and his allies, he felt, should not be blamed.“If someone can find someone that unequivocally was involved with it, I’ll kill him myself,” Dunne told the Golf Channel this past week. “We don’t have to wait around.”The morning after their dinner, al-Rumayyan and Herlihy beat Dunne and Brian Gillespie, a wealth fund lawyer, in a round at Beaverbrook Golf Club.At some point before the men parted ways after lunch, Herlihy said he believed it was essential that professional golf be unified. It was another clear signal that the tour was open to an armistice with the wealth fund that had thrown it, and golf at large, into chaos and acrimony.al-Rumayyan paused.“Let’s see how that would work,” he replied.The PGA Tour men told Monahan that he should meet his Saudi rival.Détentes and nervesal-Rumayyan was due in Venice in mid-May, scheduled to attend the wedding of the daughter of Lawrence Stroll, the billionaire Formula 1 racing titan. The lagoon’s islands were not exactly rife with golf courses, but the sides agreed that Venice would be where al-Rumayyan and Monahan would meet for the first time.Monahan, who had risen through Fenway Sports Group and then the PGA Tour before he became commissioner in 2017, had spent months studying and talking about al-Rumayyan.The tour had capitalized on LIV’s Saudi ties, harnessing American emotion and skepticism to sow moral doubts about the league. But now Monahan would undertake a covert mission to meet the man his team had vilified.Survivors and family members of victims of the Sept. 11 terrorist attacks, members of the organization 9/11 Justice, voiced their objections to LIV at Trump National Golf Club in July 2022.Doug Mills/The New York TimesThe group from the United States arrived behind schedule, after its plane required a diversion to Farnborough, England. A series of boat rides later, Monahan at last greeted al-Rumayyan and the Saudi executive’s wife and daughters before the men settled into a private session for about two hours.In the evening, al-Rumayyan went to the wedding, a glitzy gathering dotted with movie stars and world-class athletes. The Americans, preparing for serious negotiations the next day with al-Rumayyan, met for dinner. The trip would also include a meal with al-Rumayyan’s family and some of his closest lieutenants.To the tour’s negotiators, the meetings in Italy were the most pivotal of the conversations that would continue in video conferences, phone calls and gatherings in San Francisco and New York over less than a month.During Memorial Day weekend, the PGA Tour’s Cessna Citation X jet hopscotched from New York to San Francisco. Takeout burgers were brought aboard during a brief stop in Omaha, instigated by Michael Klein, the well-connected banker who was working with al-Rumayyan and invited on the trip.Most of the flight, which also included Monahan, Dunne and Herlihy, was devoted to ironing out some of the remaining details. The men were hoping to finalize things in San Francisco, where al-Rumayyan would attend meetings related to the wealth fund’s other business dealings.An agreement was close, its terms detailed across mounting pages of legalese, with the new company known simply as “NewCo.” Some of the negotiators were still nervous. A leak before a deal was signed, they were certain, would cause an uproar: How could the PGA Tour consider taking the Saudi money it had denounced?“What changed?” Monahan would say after the deal became public. “I looked at where we were at that point in time, and it was the right point in time to have a conversation.”“It was the right point in time to have a conversation,” Monahan said after the deal was announced.Erik S Lesser/EPA, via Shutterstock“I recognize that people are going to call me a hypocrite,” he said. “Anytime I said anything, I said it with the information that I had at that moment, and I said it based on someone that’s trying to compete for the PGA Tour and our players. I accept those criticisms. But circumstances do change.”In the early hours of May 30, after a bargaining marathon, a dozen or so people gathered at a Four Seasons hotel to sign and toast the deal behind closed doors.The PGA Tour contingent did not linger long. Monahan was due at an Ohio tournament that Jack Nicklaus, who had helped found the modern tour in the 1960s and rejected an offer worth more than $100 million to work with LIV, was hosting.A signed pact, intended to bring the moneymaking components of the PGA Tour and LIV, like television and sponsorship contracts, into a new company expected to be flush with Saudi cash, did not mean the deal was complete. No one had agreed on how to value assets since the litigation had left the rivals unable to delve into each other’s books. The deal did not demand a specific investment from the Saudis, but promised them the exclusive rights to inject cash into the new company. The PGA Tour would get Monahan as the company’s chief executive and a majority of board seats, including ones filled by Herlihy and Dunne. But al-Rumayyan would be the chairman.Many antitrust experts expect the agreement will intensify the Justice Department’s scrutiny of professional golf, in part since Monahan said the deal would “take the competitor off of the board.” On Capitol Hill, lawmakers have raced to condemn it.The tour, though, is expecting an investment well into the billions of dollars. The jockeying with a wealth fund aiming to be worth $1 trillion in the next few years will be over.Yasir al-Rumayyan, during a pro-am LIV event last fall, is set to be chairman of the combined organization.Jonathan Ferrey/LIV Golf, via Getty ImagesOn Tuesday morning, after a session in New York to finalize the deal’s rollout, Monahan and al-Rumayyan sat beside each other for a television interview. Around the same time, the cellphones of players around the world lit up with the news.Monahan soon flew to Toronto to face a gathering of golfers that he called “intense” and “heated.”Dunne and al-Rumayyan retreated to Long Island’s Deepdale Golf Club for another round.al-Rumayyan won again.Mark Mazzetti More