PGA Tour courts outside investors as Saudi talks drag on
Outside investor interest in the PGA Tour is heating up as a formal deal with Saudi Arabia drags on.
Why it matters: Adding suitors to the mix could help push the deal forward with U.S. regulators or thwart the Saudis, if these parties want to box the Kingdom out and top their bid entirely.
The latest: PGA Tour commissioner Jay Monahan told players Tuesday in a memo that the group received "dozens of inbound prospects" from additional outside investors.
- The Tour has been working with Allen & Company and the Raine Group to vet the other investors and is negotiating with an unknown number of them "in order to select the final minority investor(s)."
- "We continue to remain focused on our negotiations toward a Definitive Agreement with PIF and the DP World Tour as our priority. Progress has been deliberate given the complex nature of the potential agreement," Monahan wrote, referring to Saudi Arabia's Public Investment Fund.
- While it is not known who the potential outside investors are, Fenway Sports Group chairman Tom Werner confirmed last week that they've held talks with the PGA Tour — there has been some speculation that Fenway's bid could top the Saudis.
- The memo came after the PGA Tour met with its policy board at their headquarters in Florida on Tuesday. Shortly after the meeting, the PGA Tour confirmed Rory Mcllroy, a harsh critic of Saudi Arabia and its LIV Golf league, resigned from the policy board.
Of note: CNBC asked Liberty Media CEO Greg Maffei last week if the company was interested in the PGA. Maffei noted the Tour's premium IP. Asked again about his interest, Maffei replied, with a smile:
- "Can't comment on that, but I think the PGA is premium IP."
The big picture: The PGA Tour has been working to assuage U.S. regulators and its own players that a tie-up with the Saudis is in the sport's best interest.
- The latest carrot offered by Monahan is giving the players equity in the forthcoming for-profit entity that will be formed by the PGA Tour-PIF deal.
- "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," Monahan wrote.
What's next: A final deal with PIF still has to be approved by the Tour's policy board, which includes Tiger Woods.
- Still, no actual deal is in place, with six weeks until the self-imposed year-end deadline.