PGA Tour commissioner Jay Monahan and PIF Governor Yasir Al-Rumayyan sat down for a joint interview on CNBC Tuesday morning to discuss the merger news that rocked the golf world.
After years of turmoil between LIV Golf and the PGA Tour, the two entities, along with the DP World Tour, have announced a new yet-to-be-named entity that would combine PIF’s golf-related commercial businesses and rights (including LIV Golf) with the commercial businesses and rights of the PGA Tour and DP World Tour into a collectively owned, for-profit enterprise. Monahan called it a historic day.
“There’s been a lot of tension in our sport over the last couple of years,” Monahan told CNBC, “but what we’re talking about today is coming together to unify the game of golf and to do so under one umbrella.”
Conversations began in London over golf and lunch, said Al-Rumayyan, who noted that had the two Tours met two or three years ago for those same discussions, the impact on the game would have been lesser.
“Because it would be something small,” he continued. “But the way we’re doing our partnership, it’s going to be really big, in many senses.”
PGA Tour Inc. will remain in place as a 501(c)(6) tax-exempt organization and retains oversight over its tour. During the interview, Monahan offered more insight into the breakdown and Al-Rumayyan confirmed that PIF is prepared to invest billions.
“The c6 still stays in place and out of the c6 we’ll continue to operate our tours,” said Monahan. “We’ll put our player retirement plans and assets there. So that stays in place. One of the things that’s important to both of us is every single week we’re playing tournaments, we’re making a huge impact on the communities where we’re invited guests. That continues.
“At the c6 level – you take the assets of the PGA Tour, the PIF assets, and LIV and the Asian Tour and the DP World Tour, take all of those commercial assets and drop them down into that for-profit LLC … we’re going to go through an evaluation of all of the businesses and the PIF will invest … there will be additional investment and growth initiatives. That’s what’s really exciting here.”
Best Father’s day golf gifts: Serious golfer | Gifts for less than $100 | Personalized golf gifts
Al-Rumayyan said the PIF is committed to investing “whatever it takes” to ensure success, later noting that they wouldn’t be doing this if they didn’t think it would be profitable.
“If you look at the size of golf, monetary-wise, it’s about $100 billion today,” said Al-Rumayyan. “And I think the growth, it’s there. I think working together we can have a faster growth rate than it was for the past 10 or 20 years.”
Monahan said that with more people playing the game outside the U.S., and with more off-course participants than on-course, he looks at the combined audience in this country of 48 percent under the age of 35 and sees massive potential.
“Reaching a younger demographic at a time when the sport has never been more popular, and doing so by coming together to collaborate at this point in time,” he said, “that’s where we see the commonality and purpose. And that’s where we see this huge opportunity.”
With @PGATOUR and @livgolf_league agreeing to combine, what will the new organization look like?
Saudi PIF Governor Yasir Al-Rumayyan and Tour Commissioner Jay Monahan break down the details with @davidfaber. pic.twitter.com/z62iNxNd5Y
— Squawk on the Street (@SquawkStreet) June 6, 2023
Any pending litigation between LIV and PGA Tour is dissolved with this new partnership. When asked how he thought the public might react to such a complete reversal, Monahan said it’s less about what people think now and more about how they respond 10 years from now.
“This is an opportunity we’ve never had before and to have this capital at this point in time with the strength of this game,” he said, “there’s just there’s so much opportunity and it’s an opportunity we have not been able to activate, but we will now, and we’re going to do it in a highly disciplined, rigorous way.”
The PGA Tour commissioner also dismissed concerns that a global golf entity would raise questions from anti-trust regulators.
“Every single player in men’s professional golf is going to have more opportunity and more growth,” Monahan said. “As we look to contribute to the women’s game, I would expect the same and as an industry, we’re going to grow our industry. This is all a positive on that front.”
