PGA Tour approves $3bn investment from consortium led by Liverpool FC owner

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The PGA Tour is poised to confirm that it has approved a deal for a group of investors led by Liverpool FC and Boston Red Sox owner John Henry to invest in the US golf organisation’s new commercial entity.

Strategic Sports Group, which is led by Henry’s Fenway Sports Group, is set to inject about $3bn in the Tour’s commercial business, according to two people with knowledge of the matter.

The Tour approved the investment overnight, they added. The money could arrive in stages, one of the people said.

The deal, which is set to value the entity at roughly $12bn, the people said, is the latest salvo in the high-stakes battle for the future of the sport that has engulfed the Tour since Saudi Arabia’s sovereign wealth fund launched its own rival golf group more than two years ago.

The agreement is set to include an equity participation programme for the players, a win for golfers who remained loyal to the Tour even as others defected to Saudi-backed rival LIV Golf, the people said.

The SSG deal does not include the $700bn Saudi Arabia’s Public Investment Fund, at this stage although it allows for co-investment from the wealth fund in the future. The Tour intends to continue its talks with the Saudi wealth fund over a possible deal to allow PIF to take a stake in the entity, according to a person with knowledge of the matter.

Saudi Arabia has poured billions of dollars into sport worldwide, taking major interests in football, motorsport and boxing. However, its talks with the PGA Tour have dragged on well beyond their December 31 deadline, in what has been a rare struggle for the PIF to add to its sports spending spree.

The future coexistence of the Tour’s events and LIV’s schedule have been among the stumbling blocks in talks that have drawn scrutiny from US antitrust authorities. Still unresolved are the future of how the PGA Tour’s events and calendar would coexist with LIV’s. The 2024 LIV Golf season is set to commence this weekend in Mexico.

SSG, whose backers include hedge fund manager and New York Mets owner Steve Cohen and Atlanta Falcons NFL franchise owner Arthur Blank, strengthens the Tour’s hand amid a costly battle to retain talent. Masters champion Jon Rahm became the latest star player to ditch the Tour for LIV in December.

PIF and the Tour shocked players, sponsors, media distributors and politicians last June when they called a truce, ended costly court battles and set out the intention for the Saudi fund to take a minority stake in the new commercial entity. The equity programme with SSG is also designed to mend relations with players, the vast majority of whom were blindsided by the Tour’s negotiations with the PIF.

The commercial entity and its billionaire backers are distinct from PGA Tour Inc, the tax exempt organisation that administers golf events.

Since the PGA and PIF announced their negotiations, players and US politicians have criticised their framework deal and the Tour scrambled to shore up confidence. In August, Tiger Woods joined the Tour’s Policy Board, giving players a stronger hand in the sport’s destiny.

Meanwhile, Henry of Fenway Sports Group, owner of the Boston Red Sox, Liverpool FC, and the Pittsburgh Penguins, began talking with fellow US sports owners about pooling together investment and advisory services to the Tour, according to a person familiar with the matter, in what became the SSG consortium.

The Tour Policy Board announced in December that it had selected SSG among interested outside investors to “advance discussions’‘ with the PGA and their European counterpart, the DPA World Tour.

The PGA Tour has drawn scrutiny from US lawmakers. In July, correspondence published by the US Senate showed Saudi Arabia sought control of the sport of golf in its overtures to negotiate with the PGA Tour. Leaders of the Tour also faced criticism from 9/11 victims groups, who denounced Saudi Arabia’s investments into golf as “sportswashing”.

The PGA Tour and Fenway declined to comment. The PIF could not immediately be reached for comment.