Framework of PGA Tour-LIV golf deal released
Sports
The PGA Tour will have a permanent controlling interest in the subsidiary's board of directors
WASHINGTON (Reuters) - The framework of the merger agreement of the PGA Tour and Saudi-backed LIV Golf says a for-profit subsidiary of the U.S. golfing body will be created to manage commercial investments and assets for all tours, according to a copy reviewed by Reuters on Monday.
The PGA Tour will have a permanent controlling interest in the subsidiary's board of directors, regardless of the Saudi investment, the framework says.
The PGA Tour, DP World Tour and rival Saudi-backed LIV circuit, which had been involved in a bitter fight that split the sport, earlier in June announced an agreement to merge and form one unified commercial entity. The framework agreement also ends litigation between the two sides.
The LIV Golf series is bankrolled by the Saudi Arabia Public Investment Fund and critics have accused it of being a vehicle for the country to improve its reputation as it faces criticism of its human rights record.
Saudi Arabia's Public Investment Fund Governor Yasir Al-Rumayyan will be the chairman of the new entity, called NewCo in the framework, while PGA Tour Commissioner Jay Monahan will be the CEO.
The framework is likely to be a focus of a U.S. Senate panel on July 11 where Monahan, Al-Rumayyan and LIV Golf CEO Greg Norman have been invited to testify. The proposed deal has faced intense criticism in Washington.
U.S. Senator Richard Blumenthal has asked the PGA and LIV for communications and records on their planned merger, citing concerns about the Saudi government's role in the deal and risks posed by a foreign government entity assuming control over the sport.
Blumenthal, a Democrat who chairs the Senate Permanent Subcommittee on Investigations (PSI), demanded to know how the nonprofit group came to its agreement with LIV Golf, a professional body.
He also wanted to know how any newly formed entity will be structured and operated, including how the PGA Tour intends to preserve its tax-exempt status.
