The framework agreement which outlines the new partnership between the PGA Tour, DP World Tour and Saudi Arabia's Public Investment Fund (PIF) was leaked on Monday night.
The six-page document was sent to the US Senate Permanent Subcommittee on Investigations (PSI) by the PGA Tour on Monday with other paperwork and information related to the new partnership. The subcommittee opened an investigation on June 12 after the shock announcement between parties who had, until then, been embroiled in a long and expensive legal battle.
The initial joint statement released last month, and subsequent CNBC interview with PGA Tour commissioner Jay Monahan and PIF governor Yasir Al Rumayyan, offered few details beyond plans to form a for-profit entity containing the commercial assets of the PGA Tour and DP World Tour, and in which PIF would become a significant investor.
Monday's leaked document has provided some clarity on some of the key issues, although plenty of questions still remain as plans for the partnership move forward.
Here are some of the key takeaways and what they could mean for the future of men's professional golf.
Much of the document is already common knowledge
The foundations of the agreement – that being the commercial partnership between golf's two largest tours and PIF under the formation of a new for-profit entity – comprises much of the document's information, and there isn't much new knowledge provided beyond what is already known.
That includes the creation of a "NewCo" which will include all present and future commercial operations and assets held by the PGA Tour, DP World Tour, and PIF including the LIV Golf Series, and a cash investment from PIF in exchange for equity ownership in the entity and first refusal on external capital raised by NewCo.
Not included in the new entity will be "non-operational assets such as player retirement plans and corporate reserves".
Finances aside, the PGA Tour will hold a controlling voting interest in NewCo, and PIF will hold a non-controlling voting interest "notwithstanding any incremental investment by PIF". As already revealed, Al Rumayyan will act as the new entity's chairman, with Monahan in the role of CEO.
However, there is one big additional piece of financial-related information in the document ...
PIF will become a major sponsor in men's golf
Th document explains that PIF “will make a financial investment to become a premier corporate sponsor” of the PGA Tour and DP World Tour, who will “work together collaboratively to identify a high-profile event for which PIF or its designee(s) will make a financial investment to serve as title sponsor.”
With tournament prize money radically increasing in recent years, putting existing sponsors under pressure, it should come as no surprise that PIF will start sponsoring some of the more high-profile, designated events.
There is a chance nothing actually changes
The framework outlines plans for the partnership but there is still some way to go for it to be approved and put into action. Should the deal fall through, the document says that "the parties can revert to operating their respective businesses in the state that existed pre-agreement in their discretion".
That would mean the PGA Tour and DP World Tour would continue as they are, while PIF would continue to focus their golf-related operations on LIV Golf. However, there are two key differences ...
Litigation has been dropped
A major point brought up by Al Rumayyan and Monahan in their CNBC interview is that the partnership has brought an end to the lawsuits between the two sides. As the document confirms, litigation has ended with prejudice, meaning the lawsuits cannot be resumed even if the partnership deal collapses, and ...
LIV cannot recruit new players in 2023
LIV has caused a stir in men's professional golf by recruiting several of the world's most high-profile players, tempting them with massive welcome bonuses, huge prize money, and smaller schedules, with the likes of Brooks Koepka, Cameron Smith, Dustin Johnson, and Phil Mickelson making the switch. The document, and the end of litigation, prevents LIV approaching any more PGA Tour players this year. However, if the partnership does not go ahead, LIV will be free to recruit again in 2024.
LIV's future remains unclear and uncertain
The topic of LIV Golf's future remains perhaps the biggest talking point - and the largest uncertainty. On the future prospects of the series, the document says: “NewCo will undertake a full and objective empirical data-driven evaluation of LIV and its prospects and potential and will make a good faith assessment of the benefits of team golf in general, and PIF, the PGA Tour and the DP World Tour will work together in an effort to determine how best to integrate team golf into PGA Tour and DP World Tour events going forward.”
In all likelihood, that presents three possible outcomes: 1) the three parties determine LIV Golf is not financially viable, decide to scrap it altogether, and welcome players back to the PGA and DP World Tours; 2) the entity opts to create a new team concept based on the franchise model championed by LIV, which would totally reshape the structures of the PGA Tour and DP World Tour (highly unlikely, given the lucrative long-term commitments of various commercial sponsors for existing tournaments); or 3) create a team-based series to co-exist alongside the PGA Tour and DP World Tour schedules.
Ultimately, the final decision will be based on what best serves the commercial interests of the PGA Tour, DP World Tour, and PIF.
LIV players offered a path to return – but face discipline
As per the document, the PGA Tour and DP World Tour will “establish a fair and objective process for any players who desire to re-apply for membership with the PGA Tour or the DP World Tour following the completion of the 2023 season … consistent with each Tour's disciplinary policies”.
That will allow the likes of Koepka, Johnson, Mickelson, Smith, Sergio Garcia, Lee Westwood, Bryson Dechambeau, and many other players to reapply for their tour memberships and return to their respective tours. How that process will work will be interesting: will the 11 players who sued the PGA Tour - including Mickelson and Ian Poulter - face the same criteria as those who left quietly and refused to engage in a bitter lawsuit?
Date of signed agreement puts more pressure on Monahan
When the joint-statement was issued on June 6 it shocked the golf world, not only because it announced a partnership between two opposing sides grappling for control of the game, but because it seemingly came out of the blue. Even senior players including Rory McIlroy and Tiger Woods had been given little to no warning.
Part of the reason for the secrecy was to avoid any potential leaks, while the apparent rush to make the announcement might have been caused by concerns over an impending leak.
However, the document shows that it was signed on May 30, a full week before the public announcement, giving Monahan plenty of time to forewarn those who felt blindsided by the news. McIlroy, who was thrust into the role of PGA Tour ambassador for much of the last year, can feel particularly let down.
Monahan was criticised for being a "hypocrite" for urging players to turn down LIV – frequently using the slogan, "legacy, not leverage" – only to accept PIF's investment when it best suited his and the PGA Tour's interests.
Monahan's handling of the whole situation, particularly now it's known that the agreement was signed well in advance of the bombshell announcement, will only increase the pressure on the PGA Tour commissioner.
