PGA Tour commissioner Jay Monahan informed workers Thursday the league was once no longer going to be ready to manage to pay for the continued prison struggle towards LIV Golf and its monetary backer, the Saudi Arabia Public Investment Fund, according to the Wall Street Journal. In reaction to the specter of LIV Golf, the PGA Tour no longer handiest discovered itself entangled amongst a heap of prison charges but in addition endured to build up match handbags in an effort to fend off additional recruitment of its avid gamers.
This monetary pattern was once no longer sustainable; the PGA Tour was once up towards the fifth-largest sovereign wealth fund on the planet whose property underneath control take a look at in round an estimated $620 billion. According to the report, the Tour had already racked up $50 million in prison charges and dipped into its reserves for an extra $100 million to assist the investment of the increased match handbags.
“We cannot compete with a foreign government with unlimited money,” Monahan reportedly informed workers. “This was the time. … We waited to be in the strongest possible position to get this deal in place.”
The assembly got here two days after the landmark deal between the PGA Tour, DP World Tour and Saudi Arabia PIF to merge industrial operations underneath a brand new for-profit entity was once introduced. The settlement ended all litigation between the PGA Tour and Saudi Arabia’s PIF, and gives no longer handiest reduction from prison charges but in addition what seems to be a much-needed inflow of capital into the league.
Per the settlement phrases, the Saudi Arabia PIF will serve as the unique investor within the new for-profit entity. It may even have the best to additional make investments and holds a proper of refusal on any capital that can be invested.Â
“Whether you like it or not, the PIF were going to keep spending the money in golf,” Rory McIlroy mentioned at this week’s Canadian Open. “At least the PGA Tour now controls how that money is spent. So, you know, if you’re thinking about one of the biggest sovereign wealth funds in the world, would you rather have them as a partner or an enemy? At the end of the day, money talks and you would rather have them as a partner.”