[PHOTO: Alex Slitz]
The PGA Tour announced it has come to an agreement with Strategic Sports Group (SSG) for private equity investment. The move, which has been expected since December, was made official to PGA Tour membership in a call on Wednesday morning, US time. The announcement coincided with the launch of the new for-profit PGA Tour Enterprises, for which PGA Tour commissioner Jay Monahan will serve as chief executive.
SSG is a collective of several investors and firms, fronted by the Fenway Sports Group. The sports conglomerate owns the Boston Red Sox, the Pittsburgh Penguins, Liverpool FC, and a NASCAR racing team. The group also has Fenway Park and the New England Sports Network under its umbrella.
Other members of SSG include Arthur Blank (owner of the Atlanta Falcons), Wyc Grousbeck (Boston Celtics), Marc Lasry (Milwaukee Bucks), Tom Ricketts (Chicago Cubs), Cohen Private Ventures (New York Mets) and HighPost Capital. Many of the aforementioned names have an ownership stake in TGL, the Tiger Woods, Rory McIlroy mixed-reality circuit that was set to launch in January, but was pushed back a year when its facility suffered damage in a storm in November.
SSG will invest $US3 billion into PGA Tour Enterprises with an initial input of $US1.5 billion for a valuation of more than $US12 billion. Players will receive equity into PGA Tour Enterprises; these grants, made over time, will be based on playing accomplishments, future participation and tour status.
Left mostly unsaid was what role, if any, Saudi Arabia’s Public Investment Fund will have in the new for-profit venture. The tour announced that the deal with SSG will allow for co-investment from PIF in the future, and SSG – sources tell Golf Digest – made the deal with the tour under the belief that PIF involvement will ultimately come to fruition. But there are antitrust regulations that need to be hurdled, and US Congress announced this week that its investigation into PIF and its investments in American businesses will continue.
Initially the tour sought supplemental investment to appease US government antitrust regulations rather than serving as an alternative to PIF, which is the financial backer of LIV Golf. However, talks have stalled between the PIF and the tour, and PIF’s renewed recruiting of tour players – highlighted by December’s defection of Jon Rahm to LIV – led to hurt feelings on the tour side, sources familiar with the tour proceedings told Golf Digest. PIF, meanwhile, looked at the tour’s solicitation with other private equity deals as a betrayal of sorts to the June 6 framework agreement.
Even if an agreement between the PGA Tour and PIF comes together, there’s a chance professional golf will not be unified for another one to two years, sources tell Golf Digest.
The news comes as LIV Golf launches its third season this week in Mexico, while the PGA Tour hosts the AT&T Pebble Beach Pro-Am, its second signature event of 2024 with a $US20 million overall purse.