Sources: PGA Tour finalizes $3B deal as LIV talks continue

The PGA Tour has finalized an agreement with Strategic Sports Group, a consortium of billionaire sports team owners, to infuse up to $3 billion into a new for-profit entity, PGA Tour Enterprises, sources told ESPN on Wednesday.

PGA Tour commissioner Jay Monahan was expected to inform PGA Tour, PGA Tour Champions and Korn Ferry Tour members of the deal in a conference call Wednesday morning.

The conference call, which was scheduled for 9:30 a.m. ET, will be listen-only. The player relations staff told tour members in a memo that there will be several meetings and touch points over the next several weeks to address their questions and provide additional details.

ESPN reported on Dec. 15 that a deal with Strategic Sports Group was imminent. SSG includes Fenway Sports Group founders Tom Werner and John Henry of the Boston Red Sox, Mark Attanasio (Milwaukee Brewers), Arthur Blank (Atlanta Falcons), Wyc Grousbeck (Boston Celtics), Steve Cohen (New York Mets) and others.

The deal with SSG consists of an initial investment of $1.5 billion. SSG has consented to an additional investment in PGA Tour Enterprises by Saudi Arabia’s Public Investment Fund (PIF), pending regulatory review and approval.

Strategic Sports Group would be a minority investor in PGA Tour Enterprises, and the PGA Tour would remain the majority shareholder.

Meanwhile, the PGA Tour is continuing its negotiations to finalize an agreement with the PIF and the DP World Tour, which would potentially inject additional billions of dollars into PGA Tour Enterprises, according to sources.

The PGA Tour, DP World Tour and the PIF signed a framework agreement June 6 to combine their commercial assets, including the LIV Golf League. The agreement had a Dec. 31 deadline, which was extended as the sides continued to hammer out final details. Monahan and PIF governor Yasir Al-Rumayyan reportedly met in Saudi Arabia last week.

The PGA Tour policy board held meetings ahead of this week’s AT&T Pebble Beach Pro-Am in California. The PGA Tour’s player advisory council is scheduled to meet via conference call Wednesday morning. Rory McIlroy, who resigned from the PGA Tour policy board in November, told reporters Tuesday that a deal with SSG seemed imminent.

“I know that they were supposed to vote on it Sunday night, and there was a delay,” McIlroy said Tuesday. “They were supposed to vote on it last night, and there was a delay. I feel like this thing could have been over and done with months ago. I think just for all of our sakes that the sooner that we sort of get out of it and we have a path forward, the better.”

Part of SSG’s investment will be used to provide golfers with equity in the newly formed corporation, which would have an overall valuation of about $12 billion if the PIF agreement is also finalized. In a memo to members in November, Monahan provided details of the potential equity share for golfers who remained loyal to the tour.

“Tour management has designed a program that would align the interests of our members with the commercial business of the Tour via direct equity ownership in PGA Tour Enterprises,” Monahan’s memo said.

“At the point we secure outside investment, this would be a unique offering in professional sports, as no other league grants its players/members direct equity ownership in the league’s business. We recognize — as do all of the prospective minority investors who are in dialogue with us — that the PGA Tour will be stronger with our players more closely aligned with the commercial success of the business.”

The PGA Tour’s proposed alliance with the PIF and DP World Tour has already drawn the scrutiny of Congress and the U.S. Department of Justice’s Antitrust Division.

The future of LIV Golf, which has continued to poach PGA Tour players in recent months, including Masters champion Jon Rahm and England’s Tyrrell Hatton, is one of the sticking points in the negotiations with the PIF. The Saudis have been insistent that team golf remain a part of the sport’s future, according to sources.