Digesting and Thoughts on the PGA-DPWT-LIV Merger

Although the dust won’t settle from the earth-shattering news that the PGA TOUR, DP World Tour, and LIV Golf will be merging together at the end of this year, there’s a lot that can be taken from the recent announcement, and a lot of thoughts about how this plays out for players and personal.

PIF Won, the TOUR’s Players Lost

Let’s start by acknowledging the elephant in the room. The Saudi Public Investment Fund (PIF)—the financial force behind LIV—won this yet-to-be-finalized arrangement between the three former rivals. Don’t think so? Disagree?

Well, the announcement—which contained very limited, incomplete details about this unification—contains some very, very interesting statements that signal PIF has the reins going forward. In particular:

• “PIF will initially be the exclusive investor in the new entity…” No secrets here: being the sole money source gives you a lot of influence over what happens.
• “The Board of Directors of the new commercial entity will include Al-Rumayyan as Chairman…” For those unaware, Yasir Al-Rumayyan is the governor of the PIF. In short, Al-Rumayyan is now the big boss, i.e., Jay Monahan will now be reporting to him.

The crazy part about this is that PIF just wanted an invite to the PGA TOUR’s party, but now they’ll be deciding what cake is being served, the decorations, and who’s invited to the party.

Meanwhile, the PGA TOUR players who stayed—and we’ll discuss this aspect in greater detail in a moment—are getting the short end of the stick. After being pressured to criticize their colleagues who departed, going as far as accusing them of taking “blood money” and not playing “real golf” anymore, are now finding themselves in a precarious position. Indeed, starting next year, all of these golfers will be accepting the alleged “blood money” from the TOUR’s leading financier, and the guys who supposedly haven’t played “real golf” in a year have found themselves near the top of the leaderboard at the first two Majors.

 

 

 

 

 

 

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Why Merge Now?

Less than a year has passed since LIV’s inaugural event, so how was this the outcome after less than 365 days? Well, after three LIV golfers—Koepka, Mickelson, and Reed—finished in the top 5 for the 2023 Masters, and Koepka bringing home the 2023 PGA Championship—the “they’re washed up” and “not playing real competitive golf” narratives both went up in flames. But, personally, I think the biggest mover was the litigation taking place in federal court.

As we, and countless others, have reported, the PGA-LIV litigation had entered the discovery phase, where both parties—and PIF, by extension—were facing the reality that they would need to make certain individuals, namely, Monahan and Al-Rumayyan, available for depositions, in addition to turning over some very, very unfavorable information and documents about themselves: the PGA TOUR did not want its financials, non-profit status, and retaliatory acts—including threatening sponsors to not even think of partnering with LIV—being exposed, while LIV wanted to avoid the PIF and Al-Rumayyan being dragged in like the plague. Rumors are coming out that the TOUR—whose treasure chest was severely depleted—incurred more than $50 million in legal fees in a case that still had a long way to go.

This “amicable” resolution avoids all this (and so much more) while also giving everyone what they wanted: the PGA TOUR gets a much-needed capital injection and drastic change to its product, and the PIF gets entry into a global-professional sport.

In the large scheme of things, the “outcome” is not that surprising. What will be interesting, however, is how everyone explains some of the statements that have been made during the past year.

 

 

 

 

 

 

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The “Loyalists” Got Duped

As we alluded to above, imagine spending a year criticizing your friends, accusing them of taking “blood money” and not playing “real golf” anymore. Many loyalists claimed, instead, that they’re not doing this for the money because they play the sport to uphold its legacy. And then they doubled down on this, while management starts imploring one of the most heinous things to occur on U.S. soil during the past 20 years and touting that, that unlike the LIV golfers, loyalists will never need to apologize for aligning themselves with—for lack of a better word—terrorist.

This drew a very clear line in the sand. Remarkably, however, the TOUR—without giving any of the loyalists a heads-up—is now walking everything back; they accept money from the same people they were accusing to be the organizers of an atrocity. Yikes.

Well, that’s exactly where TOUR players like Rory McIlroy and Justin Thomas, are finding themselves right now. Indeed, going forward, they will be forced to accept money that was, in all likelihood, provided by the PIF.

The only “saving grace” that the loyalist can hold onto is that they’re, somehow, going be “rewarded” for staying. But I’m not so sure about that:

• One of the big rumors is that the LIV golfers will need to go through some “difficulty” process to return to the TOUR. I do not think “difficulty,” however, will mean expensive or time-consuming; instead, I think “difficult” means complex because no one knows what this unification actually looks like. Why? First, if this was some unnecessarily painful process, it would only draw the anti-trust scrutiny of the U.S. Department of Justice due to the fact that, by Monahan’s own words, the unification has eliminated their only competitor—LIV. Second, I like to think that Al-Rumayyan—as the TOUR’s new Chairman—will not just turn his back on the group of guys—Koepka, Smith, Mickelson, and many more—that helped make all of this possible.
• Another big rumor that’s been going around is that the loyalist will get equity in the new combined entity. I don’t see how that works cleanly. Does everybody who stayed equity, or do we have to prorate it for guys who are more valuable than others (Rory vs. Fowler vs. Cameron Champ). Indeed, Chesson Hadley—currently ranked 297—is already asking where’s his loyalty compensation, despite not yet presenting any proof that LIV solicited his involvement in their league. But should Hadley expect anything besides a “thank you”? And if not him, then whom?

JUST IN: per PGA Tour Policy Board member and deal broker Jimmy Dunne:

• Golfers who remained loyal to the PGA Tour would receive equity in the new entity

• LIV players will not be eligible to receive equity in the new entity

• If LIV folds, current PGA Tour members and… pic.twitter.com/g8ZmdJSUy5

— John Nucci (@JNucci23) June 10, 2023

Are LIV Golfers Welcome and “Good” Again?

Since the formal announcement of LIV and its initial crop of players, certain golf media outlets have repeatedly leaned into the departing golfers, claiming that they’re “washed up,” “past their prime,” and “on the backend of their careers,” among other things. In fact, The Guardian went as far as calling out Henrik Stenson, Sergio Garcia, Ian Poulter (along with a few others) in an article during July 2022 that completely failed to acknowledge each of these individuals’ record accomplishments in high-level events like the Ryder Cup.

But LIV golfers came out swinging in 2023, with Koepka locking in a tie for second (alongside LIV captain Mickelson) and third-time PGA Championship in the only two events featuring TOUR, DPWT, and LIV players.

And now that the leagues are coming back together, it will be interesting to see how the golf publications that were quick to criticize LIV golfers walk their biased statements back, especially when the odds are not looking very good for the Europe team this year—who will be deprived of Stenson, Garcia, and Poulter this year (while Koepka may have punched his ticket for Team USA with consistent, stellar play in this year’s first two Majors). Indeed, following the announcement, some sponsors—TaylorMade and Srixon—made it a priority to feature the LIV guys before the U.S. Open on their social media channels rather than taking the wait-and-see-how-they-do approach. Mainstream golf media, however, is yet to flip-flop on its stance.

 

 

 

 

 

 

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Monahan Doesn’t Survive, Nor Does His “Legacy”

Nobody likes somebody that speaks out of both sides of their mouth. By playing both sides, you’ll quickly lose the respect of your peers, who can no longer trust anything that comes out of your mouth.

And that’s the reality Jay Monahan is facing now. After spending the past year taking every opportunity to take a shot at LIV, including repeatedly associating it with the 9/11 terrorist attacks and killing of journalist Jamal Khashoggi, Monahan is now eating his words and making apologies he claimed TOUR players would never have to for accepting “blood money.”

So you have to ask yourself, “Does Monahan survive this?” And even if he does, how long can we expect him to serve as the TOUR’s CEO under the new management?

Personally, I don’t see how Jay holds his position beyond 2024. Jon Rahm, who remained fairly neutral during all of this, has stated that “a lot” of PGA TOUR players “feel betrayed,” and I’m sure many others have lost any respect they once had for Monahan after making the complete about-face when it was convenient from him and TOUR. As a result, I do not see how the TOUR golfers on either side agree that Monahan—who’ll now be remembered as the man who sold out golf—remains in power going forward.

 

 

 

 

 

 

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LIV’s Format & Teams Are Here To Stay

During the announcement, repeated references were made to whether team play will continue. Likewise, numerous LIV golfers, including Dustin Johnson, have been asked and repeatedly stated that as far as they’ve been made aware, LIV’s format expects to continue into 2024.

I genuinely believe LIV will become a new staple on the TOUR. 52 weeks a year filled with stroke play gets very old; it’s also cost the TOUR viewership over the years as there’s a marginal difference between the various non-Major/FedEx Cup events during the course of the year. Team play adds a much-needed new flavor to professional golf. Additionally, it offers a new way to capture fans—a team can last in perpetuity, a golfer, meanwhile, does not—and sponsorship opportunities, things that the TOUR needs and can benefit from.

That said, I do not believe it will be recognized as LIV. I think for the two leagues to reconcile their differences, the LIV branding will need to disappear.

How that shakes out with the current player/team owners, like DJ and Koepka, I have no idea. But like all things, it seems that money will be able to fix that too.

 

 

 

 

 

 

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Elevated Events Will Be a Forgotten Pastime

Also going the way of the dodo will be elevated events—the TOUR’s failed attempt to keep pace with LIV and its exaggerated purses. The simple fact is that while the broadcasting companies, more or less, demand that there’s Major-stacked fields at non-Major events for ratings, these guys need breaks and time away from the game to stay fresh.

The TOUR wrongfully placed the broadcasting companies’ interest ahead of the players, giving credibility to DJ’s now-infamous statement during Full Stroke.

Indeed, Rory, who was quick to champion elevated events, withdrew from two of the events within only a few weeks of each other after a disappointing Masters performance.

Additionally, rumors are swelling that the TOUR was being forced to dip into its own pocket to help finance the exaggerated purses because sponsors were confused about why they should pony up additional funds for what, more or less, is the same event.

As a result, I can’t see how the players or the TOUR desire the exaggerated events—which were largely created to combat LIV—continue after 2024.

This Unification May Not Even Happen

This may be the most bizarre aspect of the announcement—it is entirely possible that the unification does not even occur.

Indeed, in the wake of the very unexpected announcement, many politicians have thrown their hats into the wrong and claimed that the merger must be investigated. And while the political chatter would normally lead to absolutely nothing, the fact of the matter is that the U.S. Department of Justice has investigated the TOUR’s potential antitrust violations numerous times, including very recently during the LIV-TOUR litigation.

Indeed, less than 10 days after the announcement, the DOJ announced that it would be opening an investigation into the merger and its potential antitrust violations.

Depending on what the DOJ finds, there could be another JetBlue-American Airlines undo-the-merger situation, potentially returning everyone back to the courtroom.

🚨🐻👋 NO COMING BACK — PGA Tour legend & Memorial Tournament host Jack Nicklaus shared his stance on LIV today: “I don’t really consider those guys part of the game anymore; and I don’t mean that in a nasty way… or really mean it that way…To me, we’ve got the best field we… pic.twitter.com/w9fJtyXjIo

— NUCLR GOLF (@NUCLRGOLF) May 30, 2023

Prepare for the TOUR to Ruin Online Content

There’s only one more downside to this arrangement. The TOUR has guarded its content, specifically videos of player swings and shots hit during rounds like its life depends on it. Indeed, the PGA TOUR more or less destroyed countless Instagram accounts that tried to share pro swings for educational purposes.

LIV, meanwhile, took the complete opposite approach by allowing people to senselessly share videos of each player’s swings.

Sadly, I expect that with this merger, the swings of Dustin Johnson, Brooks Koepka, and Cameron Smith will put behind a locked copyright wall to never be shared on social media by anyone but the PGA TOUR.

Cover Image Via Twitter