Jordan Spieth doesn’t think the PGA Tour needs a deal with LIV Golf, PIF after $3 billion investment
While it’s unclear how close it actually is to being finalized, Jordan Spieth doesn’t think that the PGA Tour needs to strike a deal with LIV Golf and Saudi Arabia’s Public Investment Fund anymore.
Spieth, speaking after the Tour announced a $3 billion investment deal with Strategic Sports Group on Wednesday,
“I don’t think that it’s needed,” Spieth said Wednesday from the AT&T Pebble Beach Pro-Am. “I think the positive thing would be a unification [for the sport] … But the idea is that we have a strategic partner that allows the PGA Tour to go forward the way it’s operating right now without anything else with the option of other investors.”
The Tour announced Wednesday that SSG was investing up to $3 billion into the Tour. That deal will lead to the launch of PGA Tour Enterprises, a commercial venture under the Tour’s control that players can have equity in. The investment will entitle players to over $1.5 billion in equity shares.
The PIF, which backs LIV Golf, is not included in this deal — though it “allows for a co-investment from the Public Investment Fund in the future subject to all necessary regulatory approval.” The Tour and LIV Golf still have not finalized their partnership, something that was supposed to be done before the end of 2023. LIV Golf is launching its season this week in Mexico.
“I think the coolest thing about it is the players are now owners,” Spieth said. “So not only do they benefit with the Tour, they now are equity owners so they want to push it themselves, they want to make the product better themselves. Not that they didn’t before, but you directly benefit from owning a piece. So I think that part is maybe the coolest part of the funding.”
So for now, the Tour will continue on as scheduled — though it will do so with more money to help fund purses and pay players, something it can now do without having to rely on Saudi Arabian funding. Spieth, who joined the Tour’s player policy board after Rory McIlroy stepped down late last year, is in the field this week at Pebble Beach, which is the second designated event of the season.
The Tour and LIV Golf may come to terms on their agreement eventually. But now, thanks to the deal with SSG, the Tour is in a much better spot financially. If The Tour and LIV Golf are going to come together, Spieth said, it will be because both sides benefit.
“At this point if the PIF were interested in coming in on terms that our members like and/or the economic terms are at or not beyond SSGs and they feel it would be a good idea, I think that’s where the discussions will start,” Spieth said.
“I understand it could take some time to even come to those kind of terms … I hope that this starts to turn the corner and [people] recognize that we’re in a place where we could be better than we’ve ever been as a tour.”
PLAYA DEL CARMEN — LIV Golf CEO and Commissioner Greg Norman’s message to his entire staff in relation to the news of the Strategic Sports Group’s $3 billion investment in the PGA Tour to create a new for-profit entity was simple: onward.
In a letter obtained by Golfweek sent just days before the start of the 2024 LIV Golf League season at Mayakoba’s El Camaleon Golf Course in Mexico, Norman wrote to his staff to not just hype up LIV Golf’s third official season, but to also downplay any negative impact the SSG investment may have on LIV’s future.
An excerpt from the letter:
As you may have seen, the PGA Tour made an announcement this morning about an investment partner. Let me make one thing very clear: nothing announced by other tours or investment groups changes LIV Golf’s positive trajectory or future plans.
We started LIV Golf with the goal of creating something new, taking the game to a global, diverse audience and driving innovation while growing golf’s fanbase. More investment in golf is a great thing for the game and for us. It’s a positive development for our players, our fans, and for the long-term future of the game.
Golf is now viewed as an asset class. We proved this was possible and are now in a unique position to mold and drive this incredible growth opportunity. This broader interest and commitment to the game, and investment in its future, would not have happened without the emergence of LIV Golf as an innovative force in the golf ecosystem.
Norman said the league was “moving full steam ahead” into 2024 and beyond and that he has “never been more confident in the league, the people involved, and our supporters all over the world.”
Just seven months ago the Tour announced a framework agreement with the DP World Tour and Saudi Arabia’s Public Investment Fund to create what we now know today as PGA Tour Enterprises. The Tour confirmed in a release on Wednesday that progress has been made in ongoing negotiations with the PIF, LIV Golf’s financial backers, on a potential future investment. That same release also stated that PGA Tour Enterprises allows for a co-investment from the PIF in the future, “subject to all necessary regulatory approvals.”
The previous deadline of Dec. 31, 2023, to come to an agreement was missed, but both sides have ventured on. The PGA Tour now has more money to spend and LIV has new assets in former Tour players like Jon Rahm and Tyrrell Hatton. As Norman would say, onward they go.
The future of professional golf remains uncertain, but according to a report, answers could be around the corner.
The Strategic Sports Group (SSG), an outside investment group headlined by Fenway Sports Group and comprised of several high-level U.S.-based sports owners, may begin its investment in the PGA Tour as early as next week, according to a Sportico report.
Back on June 6, 2023, the Tour announced a framework agreement with the DP World Tour and Saudi Arabia’s Public Investment Fund to create a for-profit golf entity known as PGA Tour Enterprises. Four months later, the PGA Tour’s policy board announced it had advanced discussions with the SSG and that it had not shut the door on the PIF.
ESPN previously reported anywhere from $3 billion to $7 billion may be in play, but Sportico claims the total money for the new entity will be less than the $3 billion figure. According to Sportico, the SSG investment will cover the Tour’s domestic rights. The PGA Tour has yet to respond to Golfweek for comment. A Tour representative told Sportico the information it reported was “incorrect” but did not elaborate further.
One could argue that bringing in outside investors is a way to make the deal more palatable given the U.S. government’s various questions. On the flip side, such a move might be seen as a way for the Tour to have its cake and eat it, too, by pushing the Saudis out after ending the litigation with the framework agreement. The former seems more realistic and would be a step towards reuniting the game, while the latter would be another pivot from the Tour that would only lead to more battles with LIV.
This year was supposed to usher in a new era of professional golf following the last two years that were chock-full of uncertainty. While plenty of questions remain, some answers may be near.