The PGA Tour logo is seen after the third round of The Players Championship was suspended due to severe storms at TPC Sawgrass Players Stadium in Ponte Vedra Beach, Fla., May 14, 2011.
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The PGA Tour has begun a public defense of its deal with Saudi-backed LIV Golf ahead of a key Senate hearing scheduled for this week.
Tour chief operating officer Ron Price, who will testify Tuesday, released a statement column defended the deal on Monday at The Athletic and explained why it’s the best outcome for golf’s future. He also argued that the agreement should not be considered a merger.
“Given the long-running legal dispute between the PGA Tour and PIF, we understand the fair and valid questions raised by PGA Tour members, tour partners, the media, fans and now Congress,” Price said in an op-ed.
A few days ago, a reshuffle of the PGA Tour’s policy committee added another hurdle to the deal’s path to approval.
Former AT&T CEO Randall Stephenson resigned Saturday from the PGA Tour policy committee, where he has served since 2012. Stephenson’s resignation comes as lawmakers appear likely to launch a broad investigation into the merger between the PGA Tour and LIV starting with a Senate hearing on Tuesday.
Senators Richard Blumenthal and Ron Johnson, chairman and ranking member of the Senate Homeland Security Committee’s Permanent Investigative Subcommittee, met Tuesday. Senators asked officials from the circuit and the Saudi Public Investment Fund to attend the panel.
The PGA Tour said in a statement last week that while senators have requested testimony from PGA Tour Commissioner Jay Monaghan, Price and Jimmy Dunn, an independent director of the policy committee, will be in attendance. Monaghan has been on furlough due to an unknown health condition, but recently announced he will return to work on July 17.
PGA Tour Commissioner Jay Monahan speaks during the final round of The Players Championship at the Players Stadium course in Ponte Vedra Beach (TPC Sawgrass), Fla., on March 12, 2023.
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“We look forward to appearing before the Senate subcommittee and answering their questions regarding the framework agreement that establishes the PGA Tour as the future leader in professional golf and benefits our players, fans and our sport,” said the PGA Tour representative. said in a statement. most recent statement.
Tour had no comment beyond Price’s Monday column.
The senators said in an earlier letter that the subcommittee would review the proposed deal and the Saudi fund’s “investment in U.S. golf, the risks associated with foreign government investment in U.S. cultural institutions, and the implications of this proposed agreement.” American influence”. American professional golf is moving forward. “
It was not immediately clear whether representatives of Saudi Arabia’s Public Investment Fund would testify. Representatives of PIF have not responded to repeated requests for comment.
defend the deal
Last month, the PGA Tour and PIF’s LIV Golf, as well as Europe’s DP World Tour, Agree to merge. While the exact terms of the deal and valuation were not announced, early outlines of the proposed deal show it would create a for-profit subsidiary of the PGA Tour, with the new entity managing all of the tour’s commercial assets. The PGA Tour will manage the tournament.
The proposed deal shocked the sports world — including the tour’s own players — after months of tension between the PGA Tour and LIV Golf that resulted in the two entities filing antitrust claims against each other. All litigation between the two has been suppressed as part of the proposed deal.
Price acknowledged in Monday’s column that the deal came as a surprise after two years of “unprecedented conflict.”
Negotiations are still ongoing and the framework ends litigation between the two entities. Price argued that because of the confidential nature of the deal, “much of the initial reaction was negative, tinged with misinformation or misunderstanding.”
“This is something we fully take on and deeply regret. Looking ahead, we firmly believe that the more the facts are discussed and understood, the more our constituents will support a potential final agreement – if reached – and look forward to positive and An enduring agreement.” The impact on every level of our game,” Price said in Monday’s column.
The two entities have been embroiled in antitrust lawsuits since last year. LIV sued the Tour, accusing it of banning its players for anti-competitive conduct, while the Tour countersued, claiming LIV stifled competition.
Price defended the framework agreement, saying it was a favorable outcome not only for the tour but for professional golf as a whole. The agreement, he said, “provides clear, definitive and permanent safeguards to ensure the PGA Tour can lead the decisions that shape our future and ensure we have control over the continuity of our operations, strategy and mission.”
He added that if an agreement was reached, it would allow for further investment in players, events, venues, communities and technology. PIF said it would invest billions of dollars in the new entity.
Price also argued that the deal “is not a merger.” The tour will remain the same, and the new subsidiary will include PIF as a non-controlling minority shareholder, as it does in “many other U.S. businesses,” he wrote. The majority of the Board of Directors, which lead the PGA Tour Enterprises, will be appointed by the Tour and managed by Monaghan.
After the announcement, top golfer Rory McIlroy expressed discomfort with the proposed deal being dubbed a merger. Rory McIlroy has lashed out at LIV Golf several times during his feud over the years.
LIV has been the subject of controversy since its inception in 2022. PIF is not held publicly and is a sovereign wealth fund controlled by bin Salman. Critics have accused the fund of engaging in a “sports shuffle,” using LIV and other sports investments to improve the oil-rich nation’s image and divert attention from the kingdom’s history of human rights abuses.
Stephenson pointed to one of the alleged violations in a resignation letter to the rest of the board on Saturday.
The PGA Tour notified its member Stephenson on Sunday night to leave the policy committee, according to a memo seen by CNBC. It noted that “no specific time frame has been designated for the succession of independent directors.” The four remaining independent directors will fill the position in consultation with the board’s five player directors and PGA directors.
He wrote in the memo that he had “serious concerns” about the proposed deal and whether he would be able to objectively assess or support it because of U.S. intelligence reports that assessed Saudi Crown Prince Mohammed bin Salman Ordered the killing of journalist Jamal Khashoggi in 2018.This memo was published earlier report Reported by The Washington Post.
Stephenson’s concerns about taking Saudi investment are similar to those expressed by others on the trip, as well as by politicians. Stephenson did not respond to a request for comment.
A 2021 report from U.S. intelligence revealed that the Saudi crown prince had approved an operation in 2018 to capture or kill journalist Khashoggi. The report pointed to bin Salman’s control over decision-making in Saudi Arabia and details of the involvement of a key adviser and member of the prince’s protection in the killing of royal critic Khashoggi.
Lawmakers have questioned the merger since the golf tour announced it. Top Senate Democrats have expressed antitrust concerns and urged an investigation into the merger.
“Fans, players and concerned citizens have many questions about the planned agreement between the PGA Tour and LIV Golf,” Johnson said in a release last month.
While the investigative subcommittee has broad jurisdiction to probe issues including corporate abuse, committee hearings are relatively rare and typically mark the early stages of a long-running probe. The hearing on the merger is the committee’s second hearing this year.
Before scheduling the meeting, Blumenthal had announced his intention to investigate the deal in light of human rights abuses in Saudi Arabia.
When the deal was announced, Monaghan acknowledged it sparked shock and anger among players.
LIV golf events have been met with protests, especially by the families of those killed in the September 11, 2001 terrorist attacks. Fifteen of the 19 hijackers that day were from Saudi Arabia, the country where the mastermind of the attack, Osama bin Laden, was born. U.S. officials concluded that Saudi nationals helped finance the terrorist group al-Qaeda, although the investigation did not find Saudi officials involved in the attacks.
Members of the group 9/11 Families United slammed the deal. They also accused Monaghan of making comments in an interview last summer when he said he discussed 9/11’s ties to PGA Tour players and implied that the organization took a higher moral stand than LIV.
“I think the only way to live under a rock is to not know the big implications,” Monaghan told CBS Sports. “I would ask any player who has left or anyone who is considering leaving. Players, ‘Have you ever apologized for being a part of the PGA Tour?'”