PGA Tour to offer players equity ownership

The PGA Tour announced on Tuesday that it will give professional players direct equity ownership in the company formed after securing investments. This information comes from an internal memo obtained by CNBC.

Negotiations are currently underway with the Saudi Public Investment Fund (PIF), which owns LIV Golf, and the DP World Tour. PIF and the DP World Tour remain the focus of the discussions, as stated in the memo by PGA Tour Commissioner Jay Monahan.

The PGA Tour and LIV Golf reached a framework agreement earlier this year to consolidate their business interests in the golf industry. The formation of this alliance was met with backlash and scrutiny, especially from players like Rory McIlroy. These concerns led to Senate hearings to examine claims that the deal was aimed at bolstering Saudi Arabia’s influence in the U.S. through sporting investments.

The latest program outlined in the recent memo is part of the PGA Tour’s efforts to align the interests of its players with its business operations.

Monahan emphasized, “If and when we secure outside investment, this will be a one-of-a-kind offering in professional sports, as no other league grants its players direct equity in the league’s business. We recognize that the PGA Tour will be stronger with our players more closely aligned with the business’s commercial success.”

Monahan also disclosed that the Tour’s agreement with PIF and the DP World Tour has attracted interest from other investors, and the board is evaluating private investors’ proposals to select finalists.

Last week, Fenway Sports Group Chairman Tom Werner acknowledged discussions with the PGA Tour but refrained from providing further details. There is speculation that Fenway might make a bid surpassing that of the Saudis.