The PGA Tour has reached a deal 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, that was officially launched Wednesday, the tour announced.
Under the terms of the deal, Strategic Sports Group, which is being led by Fenway Sports Group, would make an initial investment of $1.5 billion with the possibility of another $1.5 billion coming later. The PGA Tour will control the for-profit company.
The tour said in a news release that the deal with SSG allows for a co-investment from Saudi Arabia's Public Investment Fund, subject to all necessary regulatory approvals.
The PGA Tour said nearly 200 of its members would have access to a "first-of-its-kind" program that would allow them to become equity holders in PGA Tour Enterprises. The members would collectively have access to more than $1.5 billion in equity grants, which will vest over time. The size of grants will be determined by a tiered system based on "career accomplishments, recent achievements, future participation and services and PGA Tour membership status."
The equity program would be available only to qualified PGA Tour players.
PGA Tour commissioner Jay Monahan provided details of the deal with members of the PGA Tour, Korn Ferry Tour and PGA Tour Champions in a conference call Wednesday.
"Today marks an important moment for the PGA Tour and fans of golf across the world," Monahan said in a statement. "By making PGA Tour members owners of their league, we strengthen the collective investment of our players in the success of the PGA Tour. Fans win when we all work to deliver the best in sports entertainment and return the focus to the incredible -- and unmatched -- competitive atmosphere created by our players, tournaments and partners.
"And partnering with SSG -- a group with extensive experience and investment across sports, media and entertainment -- will enhance our organization's ability to make the sport more rewarding for players, tournaments, fans and partners."
Monahan will serve as CEO of PGA Tour Enterprises, according to the release.
The PGA Tour policy board unanimously approved the deal, according to the release, including player directors Patrick Cantlay, Peter Malnati, Adam Scott, Webb Simpson, Jordan Spieth and Tiger Woods.
"We were proud to vote in unanimous support of this historic partnership between PGA Tour Enterprises and SSG," the player directors said in a joint statement. "It was incredibly important for us to create opportunities for the players of today and in the future to be more invested in their organization, both financially and strategically. This not only further strengthens the Tour from a business perspective, but it also encourages the players to be fully invested in continuing to deliver -- and further enhance -- the best in golf to our fans."
The SSG consortium of owners includes Tom Werner and John Henry of the Boston Red Sox, Mark Attanasio (Milwaukee Brewers), Arthur Blank (Atlanta Falcons), Wyc Grousbeck (Boston Celtics) and Steve Cohen (New York Mets). SSG will provide "strategic focus on maximizing revenue generation for the benefit of the players and on finding opportunities to enhance the game of golf across the world."
"Our enthusiasm for this new venture stems from a very deep respect for this remarkable game and a firm belief in the expansive growth potential of the PGA Tour," Henry, principal owner of the Fenway Sports Group, said in a statement. "We are proud to partner with this historic institution and are eager to work with the PGA Tour and its many members to grow and strengthen the game of golf globally."
Fenway Sports Group, which owns the Red Sox, Liverpool FC and Pittsburgh Penguins, will serve as a commercial adviser to PGA Tour Enterprises.
The PGA Tour is continuing its negotiations to finalize an agreement with the Public Investment Fund and the DP World Tour, which would potentially inject additional billions of dollars into PGA Tour Enterprises, sources said. The tour said it is making progress in its ongoing negotiations with PIF on a "potential future investment and both parties are working towards an ultimate agreement."
The PGA Tour, DP World Tour and PIF signed a framework agreement in June 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 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, sources said.