PGA Tour says U.S. golf would likely struggle without Saudi cash infusion

PGA Tour officials told lawmakers at a Tuesday hearing that failing to explore a deal with LIV Golf would have eventually gutted the league and its players.

The Senate Permanent Subcommittee on Investigations hearing, intended to examine the PGA's controversial deal with Saudi Arabia-backed LIV Golf, kicked off with a focus on the losses suffered by the U.S. golfing organization due to a 2022 lawsuit filed by LIV Golf alleging an illegal monopoly. 

Jimmy Dunne, a member of the PGA Tour's governing board, told lawmakers Tuesday morning that the golf organization's finances were in trouble as players defected to LIV Golf and as the group battled the lawsuit. Dunne testified that he contacted Saudi officials to discuss forming a new entity, financed by the Public Investment Fund, or PIF, which is managed by the Saudi government. 

"If they take five players a year, eventually they can gut us," Dunne said.

PIF talked about infusing "north of $1 billion" in the new entity, Ron Price, the PGA Tour's chief operating officer, told lawmakers.

Last month, the PGA Tour abruptly announced it was forming a new partnership with PIF, startling the sports world following the bitter rivalry between the U.S. organization and LIV Golf. Under the transaction, the PGA Tour and PIF plan to create a for-profit golfing league, with the $620 billion sovereign wealth fund providing an undisclosed capital investment.

On Tuesday, Dunne said both sides are still hammering out details of the partnership, but "nothing will happen without the player's support."

Human rights concerns

The deal between the PGA and LIV immediately drew criticism from human rights critics, as well as from survivors and family members of victims of the Sept. 11 terrorist attacks. Some critics have described Saudi Arabia's investment as "sportswashing," or using sports and games to rehabilitate a tarnished image.

"Saudi operatives played a role in the 9/11 terrorist attacks, and now it is bankrolling all of professional golf," 9/11 Families United said in a statement last month.

Some players also said they felt blindsided and expressed concern about the future of the sport if the tours join forces.

"I still hate LIV," PGA golfer Rory McIlroy said in a press conference last month. "I hope it goes away, and I would fully expect that it does."

Former AT&T CEO Randall Stephenson, who sat on the PGA Tour's policy board, resigned from his position on Sunday citing concerns about the LIV Golf deal. 

Price, who is scheduled to testify today, penned an op-ed in The Athletic on Monday defending the PGA-LIV alliance, arguing that joining forces will ensure that the sport remains popular for years to come.

"If we get a final agreement, it will allow us to further invest in the players who define our sport, and the events, venues, communities and technology that bring it to life," he said.