Here Are Three Possible Outcomes in the Ongoing PGA Tour-LIV Golf Talks

The Dec. 31 deadline appears not likely to be met, and speculation is rampant over what may happen to unite—or further divide—the pro game.

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A deal between the PGA Tour and the Saudi benefactors of the LIV Golf League does not appear imminent, some five months after the shocking news that the sides had come together with a "framework agreement" that would see an alliance and also bring peace to golf after more than a year of tension.

Whether or not an arrangement will be completed by the stated Dec. 31 deadline is simply a guess, although a good one is that it will not. Various industry sources have stated that the sides are not close.

Making matters more interesting is the PGA Tour’s talks with various private equity firms who the Tour says have shown considerable interest in investing in a new for-profit venture called PGA Tour Enterprises that—under the framework agreement—would bring together the PGA Tour, the DP World Tour and the Public Investment Fund of Saudi Arabia.

Whether there is an agreement or not, nobody outside of the tight circle of Tour executives and possibility player directors on the PGA Tour Policy Board knows what that entity might entail. But in order to bring a return from more than $1 billion in investment, it would have to be significant.

And was made even more apparent this week when commissioner Jay Monahan told the players via a memo that they would be able to take part in "direct equity ownership"—as had been laid out earlier this year.

Commissioner Jay Monahan and the PGA Tour seem increasingly unlikely to hit a Dec. 31 deadline for an agreement with the Public Investment Fund of Saudi Arabia :: Mike Ehrmann/Getty Images

And then there was the interesting news that broke Saturday. Sports Business Journal reported that starting in 2025, the PGA Tour wants to change the funding structure for its events, with the local host organizing groups having to chip in to help cover the cost of rising purses.

That would be quite the departure from the current business model, which sees tournaments on the PGA Tour set up as 501(c)(3) non-profit organizations, with all of their profits going to charity. The events, more or less, raise funds to operate the tournament; purse and television rights fees are paid for through Tour funds. That could, possibly, but charitable giving in peril.

Both the PGA Tour and DP World Tour concluded their seasons on Sunday. LIV Golf has been done for a month. There are a few offseason events to go before the start of the new year, but official golf—at least in the United States—is complete, typically leading to a slow time.

But until there is definitive word on what will happen, these next few weeks will undoubtedly be filled with considerable conjecture.

Here’s a look at the three main scenarios that could play out, and what they might mean.

1. An Agreement is Reached

According to the framework agreement, Yasir Al-Rumayyan, the governor of the PIF, would become a member of the PGA Tour Policy Board while also chairing a new board in charge of PGA Tour Enterprises, of which Monahan would be CEO.

Whether it really works out that way is to be seen. But for all practical purposes, the LIV Golf model would have to change, if it remains. It could certainly be folded into the new company, which gives it some of the investment opportunity that is necessary. But how much of LIV would continue to exist in that scenario is unclear.

If there is also investment from other private equity, there are numerous possibilities, but all are also unknown. Rory McIlroy, who just resigned his PGA Tour board position, was vague when asked about it in Dubai this week.

"If we can create a perfect golf calendar, what would it look like? And I don’t think it would like it looks right now," McIlroy said at the DP World Tour Championship in Dubai. “I think there would be changes made.

“Look at what Max Homa and Justin Thomas did last week, going down to South Africa (where Homa won and Thomas finished fourth at the Nedbank Challenge). They had a really good time. They played in a different part of the world where they had never played before. If more of that sort of stuff could happen, I think it would be really good for golf.’’

But how? The initial agreement called for the PGA Tour Inc.—the non-profit entity—to remain as-is, meaning a full FedEx Cup schedule as we know it. That leaves little time for something extra, unless it is somehow incorporated into the PGA Tour schedule (some events counting for both?) And does an agreement by Dec. 31 allow all the parties to come up with a plan in time for 2025?

2. There is No Agreement

This remains a distinct possibility and seems to be favored by many at LIV Golf, who know that the PIF can continue to fund the league and have it play on as-is, with the hope of continuing to build the team model and seek outside investment. Whether or not those on the PGA Tour side secretly want there to be no deal is also possible, and the interest in other investors gives that view some credence.

But both sides need to be careful what they wish for here.

If there is no deal, every indication is that LIV Golf will continue on. It will throw more money trying to entice players and the PGA Tour risks losing more marquee names. It will, ultimately, weaken the overall game because some potentially elite players will not have access to major championships. And the golf war that has existed for the better part of two years only grows more volatile.

But there is also risk for the PIF. Al-Rumayyan seems to like the idea of having a seat at the bigger golf table. Being part of the scene as opposed to be an outcast. Being able to use the PIF’s numerous resources to invest in other parts of the game, which helps the country achieve its goals of diversification as well as acceptance.

Without a deal, there is no board seat for Al-Rumayyan. The larger golf world will still shun LIV Golf, with the idea that it will ever get world ranking points remote. And while the concept will undoubtedly be hugely popular in underserved golf markets, especially those overseas (Australia’s interest is huge and there is potential for growth in Asia), it still has the massive problem of lucrative television rights fees and sponsorship, which are necessary to sell the team concept to prospective owners.

The PGA Tour, in theory, would move on without the PIF and would put to use the private equity that is being discussed now among various potential investors. But it needs something to invest in. What would that be? Do the PGA Tour and DP World Tour create a separate entity that can bring enormous profit that will satisfy investors, allow players to have equity—as has been proposed—and still allow the PGA Tour to operate separately?

3. The Agreement is Postponed with a New Deadline

This increasingly seems to be the way this will go. The deadline is now less than six weeks away and most are in agreement that this is a monumental task. So many different aspects need to be addressed that even if both sides were in full harmony on everything it would not guarantee all of this could done in short order.

The question then becomes how long is it extended? Three months? Six months? The longer it goes, the more difficult it becomes to have anything in place by 2025. And is that even the goal?

As it is, the PGA Tour has a full schedule for 2024. LIV Golf is expected to announce its 14-tournament slate soon and has already started working on 2025. Any delays short of scuttling the deal put in play the idea that 2025 will again see the PGA Tour and LIV Golf run separately.

Whatever happens, it will be fascinating to see how this all plays out.