The earthquake struck around three in the afternoon of 6 June. Golf’s warring parties, the PGA Tour and its junior partner in Europe had struck a secret agreement with LIV Golf to end hostilities and work together for the good of the game.
The force of the U-turn was as shattering as the declaration of war 12 months earlier when LIV launched its inaugural tournament in St Albans. Only a small cabal of senior figures knew before PGA Tour commissioner Jay Monahan and LIV Golf CEO Yasir Al-Rumayyan appeared together in a television broadcast from New York.
The announcement triggered widespread disbelief and anger in those who understood the PGA Tour was not for turning and made their choices accordingly. Rory McIlroy, hitherto Monahan’s mouthpiece among the players, promptly resigned his commission of the PGA Tour board. Jordan Spieth bemoaned a lack of trust between the players and the tour leadership.
Ultimately Monahan understood that entente cordiale, no matter how unimaginable when he was denouncing the Saudi regime for its human rights record and sportswashing, was the only way. Or at least that is what he led us to believe. Six months on, the 31 December deadline to produce a framework agreement detailing what the new world might look like has passed without a resolution.
What is behind the delay?
Behind the scenes Mohanan has been talking to alternative investors. He claims the discussions with the PIF prompted unsolicited interest from other parties, including the Fenway Group that owns Liverpool FC and the Boston Red Sox baseball team.
Since there was every opportunity for investors to pile in during the 12-month LIV stand-off some might see Monahan as using the negotiating period as a last chance to lure backers to limit Saudi involvement rather than capitulate before it.
Either way the Saudis have come to their own understanding. The absence at the PGA Tour season opener The Sentry, Tournament of Champions, this week of defending champion Jon Rahm after his stunning $350m capture by LIV, might be interpreted as a threat. In other words, Rahm won’t be the last signing should Monahan seek to cut the Saudis out of the deal.
What happens next?
The strength of the PGA Tour’s new investor interest is yet to be established. Talks with a consortium operating under the banner SSG (Strategic Sports Group), led by the Fenway Group, are ongoing in tandem with the negotiations with the Saudi Public Investment Fund (PIF). A new deadline, which could stretch to April according to some reports, to thrash out a deal is expected to be announced in the New Year.
In effect Monahan is trading reputation and tradition for hard cash. The Saudis have plenty of the latter and none of the former. The PGA Tour needs investment to prosper. The business has a guaranteed income until 2030 of $10bn, half of that coming from broadcast deals and half from sponsors and ticket sales.
That figure made the PGA Tour the class of the field until LIV turned up with a $2bn start-up budget. Half of that has gone on player acquisition, Masters champion and world No 3 Rahm joining fellow major winners Cam Smith, Dustin Johnson, Bryson DeChambeau, Patrick Reed, Louis Oosthuizen and, of course, legacy gold, Phil Mickelson. With Viktor Hovland, Tyrrell Hatton and Tony Finau all named targets, the plunder might easily continue.
What are the risks for both parties of the deal breaking down?
The PGA Tour is predicated on legacy, the best players appearing at premier tournaments at historic venues. This is what brings in the crowds, pulls in the broadcasters and attracts sponsors. That virtuous circle is clearly threatened by the talent drain to LIV. Without the best players, the show is less compelling, viewing figures slide, and values shrink.
The Saudis see golf as a fast track to respectability and inclusion. The goal is to normalise the kingdom in the eyes of the world, to shift the gaze away from human rights and broaden perspectives. LIV Golf was never intended as a thing in itself. It was birthed as a consequences of the failure to broker a more conventional entry into the golfing establishment through the standard tools, sponsorship and tournament hosting.
Whatever the scale of SSG’s involvement it is unlikely to insure the tour against another round of LIV plunder. Similarly without a deal with the PGA Tour, the Saudis remain on the outside without the soft power dividend the association with golf’s premier brand would bring. There is still no great attachment to the LIV product. Golf fans simply don’t care enough about the tournaments, the team concept, or who wins. The lack of any significant broadcast deal is evidence of that.
How does this end?
The most likely outcome is smoke signals before the Masters, the first major of the season in April. The housekeeping issues to be settled revolve around the assimilation into the schedule of the shortened LIV format and the team element that comes with it, and the re-integration of LIV defectors.
To an extent this is already happening on the European Tour with LIV golfers contesting events. Monahan is insistent that the big-money defectors should not be allowed back on the PGA Tour without penalty.
This is a two-fold play to hit the Saudis for a bigger cash settlement and save a little face after the reputational hammering that followed the U-turn. We are probably looking at 2025 at the earliest before Rahm, Mickelson, Smith, Johnson and Mickelson face off against McIlroy and Spieth et al outside the majors.