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Cast your mind back to May 2021.
As Phil Mickelson lifted the Wanamaker Trophy at Kiawah Island – becoming the oldest man ever to win a major championship – who could have believed that he would soon defect to a brand-new, multi-billion-dollar professional golf entity; an entity built around 54-hole tournaments, 48-man fields, Formula 1-style teams, fronted by one of the game’s most iconic individuals, and funded by one of the world’s most controversial regimes.
Impossible? Evidently not. The PGA Tour is no longer the most lucrative tour in men’s professional golf. That distinction now belongs to LIV Golf, an organisation that didn’t exist until June 2021.
Its emergence has split golf down the middle. The sport has been subject to more noise, controversy, scrutiny, debate and all manner of other emotional measurables than most can remember. But how did it happen? How did we end up in this place?
This is the story of LIV Golf.
* * *
TO FULLY UNDERSTAND WHAT the LIV Golf League is and how it has happened, you need to go back to 2018. That’s when World Golf Group Ltd was finalising its plans to launch the Premier Golf League (PGL).
PGL was to be a new professional golf tour, running from January to September each year and comprising 18 different 54-hole, shotgun-start, no-cut events. Each event would feature just 48 players – separated into 12 teams – and be worth $10million.
Whilst an undoubtedly compelling idea, PGL was, essentially, just that: an idea. It needed money. As such, World Golf Group sought a relationship with the Public Investment Fund of Saudi Arabia (PIF), knowing that it was making significant investments into the game with the likes of Golf Saudi.
PGL had already engaged Raine Capital in the United States with the expectation that PIF and Raine would co-fund the launch of the new tour.
Fast-forward to August 2020. By this point, the world was several months into the COVID-19 pandemic and the European Tour – as it was then – found itself at a crossroads.
It had identified that the PGA Tour was amplifying its competitive threat and encroaching into the European Tour’s business across a range of areas. Bluntly, it was struggling to compete. Having already reportedly discussed the prospect of becoming an operational partner of PGL, the tour concluded that it, effectively, had three options to build its future around: one, partner with PGL; two, partner with the PGA Tour; or three, build out on its own with increased investment.
At this point, the European Tour is understood to have gone to the PIF with a proposal. In return for $500m (or £400m) over ten years, the European Tour would position PIF alongside Rolex and Comcast as one of its primary partners.
It would use PIF’s investment to create an investment arm of the European Tour, which would result in the construction of a new Ryder Cup venue in the UK, the elevation of the British Masters, the addition of another Rolex Series event, the elevation of the Saudi International (sanctioned at that time by the European Tour) to Rolex Series status, and the creation of another European Tour event in Saudi Arabia. The ‘offer’ also allegedly included the naming rights for the Challenge Tour.
Ultimately, the PIF concluded this wasn’t the right fit for them. It appeared to be more of a sponsorship opportunity than an investment opportunity and, beyond branding, it wasn’t apparent how PIF could make a return on the $500m it was being asked for.
PIF, therefore, decided to make the European Tour a counter offer. It would stump up the money in return for the European Tour’s commercial rights, which would enable it to sell partnerships, naming rights, broadcast rights and so on. In other words, PIF would give the European Tour the money required to secure its future but, at the same time, create a means by which it could recoup its investment.
The European Tour, according to our sources, never formally responded to that offer.
Instead, very soon thereafter, it is claimed that there was a European Tour board meeting where the opportunity for the European Tour to partner with PGL was put on the agenda.
It has been suggested to us that the PGA Tour got wind of this opportunity (and the fact that the PGL proposal may have garnered some support from certain members of the European Tour board) and so it very quickly – i.e. within 72 hours – drew up a counteroffer of its own. That offer was a strategic alliance with the PGA Tour.
In the end, the European Tour chose to go with the PGA Tour, that decision being made public on November 27, 2020.
That appeared to leave the PGL dead in the water. It didn’t have the funding – Raine reporedly hadn’t raised the capital required – it didn’t have any players, and it didn’t have a sanctioning partner or a way into the existing ecosystem.
Still, the PIF’s interest had been piqued. In late November 2020, emboldened by the success of the Saudi Ladies Team International the same month, Yasir Al-Rumayyan – the Governor of the PIF – was keen to understand what had happened, why the European Tour had knocked back the opportunity to work with PGL and, most significantly, if there was room for another commercial entity to sit at the top tier of golf. In short, he wanted to know what was wrong with PGL and whether or not it could be fixed.
Over the next six weeks, there was an intense period of analysis, evaluation and research, where the PIF investments team forensically explored opportunities to create an enhanced commercial structure for the game.
They engaged with specialists in a range of fields to formulate a business plan that was extraordinarily granular. They had to answer how many staff they would need, when they would be hired, how much they’d be paid, how many desks would be required, what square-footage of office space would be needed.
An individual who was in those meetings but asked not to be named told us: “When people describe LIV as an irrational threat or not a real business, I think back to one of those early meetings where we were asked, ‘Are you going to repaint the office in year three or year four? Just so that we can plan office maintenance into the budget.’ It was that specific, but it had to be in order to unlock a multi-billion-dollar – more than one, less than five – greenfield investment.”
Every metric was bench-marked to the nth degree. Recent start-up leagues – such as Formula E, the IPL and the Premier Lacrosse League – were inspected from floor to ceiling. More established examples of success – the Premier League, NFL, NBA and MLB – were thoroughly dissected. No stone was left unturned. A task force that, all told, comprised more than 100 people, did its best to anticipate every potential ‘what if?’ and prepare fact-based responses to them.
Late in January 2021, and over the course of two weeks spent locked in a meeting room in Fairmont The Palm in Dubai, all of those details were coalesced into a business plan. The mandate was simple: is there an opportunity for a commercial entity to sit at the top of golf and improve the game; when the tide comes in, do all boats rise?
The answer, according to the PIF, was yes. Not only that, they believed it was needed.
Golf, they reasoned, was in decline. They observed a commercial construct that hadn’t changed since the PGA Tour was born in 1968. Their research found that, in 2016, the average age of a golf fan was 64 – 11 years older than other mainstream sports. To compound matters, it had increased by five years in just ten years.
For some time, companies investing into the game had been sold on the promise of reaching an influential audience made up, in the main, of CEOs in their late 50s. It was clear that was no longer the case. The audience had become retirees more interested in buying life insurance than luxury watches or fast cars. It was an issue that was worsening every year, whilst the rights fees for the game’s biggest events kept on going up. It was a ticking time bomb – and, as far as the PIF was concerned, they had the solution.
They called their plan ‘Project Wedge’. Its stated mission? To launch a brand-new entity called Super League Golf (SLG).
By this point, all lines of communication with PGL had closed. bunkered has been told that an attempt was made to contact PGL in March 2021 but to no avail.
‘Project Wedge’ did, however, accommodate the opportunity for partnerships with all of the game’s other key stakeholders, primarily the PGA Tour, DP World Tour and the organisations behind each of the four men’s majors: Augusta National Golf Club (The Masters); the PGA of America (US PGA Championship); the USGA (US Open); and the R&A (The Open).
On April 17, 2021, a letter was sent from SLG to Jay Monahan, the commissioner of the PGA Tour. It outlined PIF’s intention to invest several billions dollars into golf through SLG and included an invitation to Monahan and the PGA Tour to open dialogue to discuss the prospect.
bunkered understands that Monahan never replied to that letter, nor has he ever responded directly to or acknowledged any attempts by SLG / LIV to engage him in discussion. Had he done so, he might have learned that the PGA Tour was being offered the opportunity to be a potential operating partner of SLG. It would get to run the ‘inside the ropes’ operation and sanction the US-based SLG events. The PGA Tour would also get to be a founding partner of SLG, there would be a dual-commissioner role for Monahan, and the tour would have an equity stake in SLG itself as well as 5% of every team. It would also be a media rights partner.
Around this time, news of SLG’s intentions reached senior executives at DP World. A multinational logistics company headquartered in Dubai, it was close to agreeing a huge new partnership with the European Tour. Concerned that SLG might impact their investment, however, they requested key SLG figures meet with them and the European Tour.
By then, SLG was in advanced discussions with the Asian Tour about a partnership but, due to the replicable nature of its proposal, it agreed to the meeting. As a result of ongoing global COVID restrictions, it had to be staged in Malta and took place from July 5-6, 2021 – the week of the Scottish Open. Amongst those in attendance at the Hotel Corinthia were European Tour chief executive Keith Pelley and his deputy Guy Kinnings; representatives from SLG; and key personnel from DP World. During the two-day summit, SLG representatives made a presentation which, amongst other things, outlined the benefits the European Tour could expect from a partnership with them.
They included the creation of an International Series of tournaments – much like the one that has since launched on the Asian Tour – which, it was claimed, would create a $42.5million prize fund contribution over five years from SLG, as well as a $10million partnership investment, also over five years. Consider this ‘Part 1’.
‘Part 2’ hinged on SLG fully launching, which it has since done under the LIV Golf identity. In such an event, the European Tour was told it would receive a 2.5% equity stake; a 5% equity stake in a team franchise; $35-40million for five years as a ‘League Production Partner’; $1.2million as a sanctioning partner for five years, based on a minimum of six sanctioned events per season; and other benefits, including a seat on the SLG board.
All told, SLG valued ‘Part 2’ at $250million plus equity value that was “conservatively estimated” at between $400-500million.
The minutes from the meeting – documented by a DP World representative – acknowledge that the “spirit [of SLG] is not to take anything from anyone” but instead “ensure that golf’s ecosystem benefits as a whole”.
The minutes also note that “over ten years, the overall financial injection into the European Tour could reach $1bn”.
It is understood that the European Tour delegation requested a short recess after the presentation and returned 45 minutes later with some concerns. They articulated the “need to avoid a collision course between the European Tour and the PGA Tour”, with whom they had agreed a strategic alliance just eight months earlier. Pelley proposed SLG make a soft launch during the off-season and, preferably, outside the United States to mitigate any risk to the PGA Tour. He confirmed to bunkered last summer that he had suggested four events: two in Europe, one in Saudi Arabia and one in Dubai, all to be played following the conclusion of the FedEx Cup. This was rejected by a senior SLG official.
On the second day, all parties reconvened for more talks, which appeared to go well. The minutes note that a collaboration between SLG, the European Tour and DP World constituted a “solid opportunity to further expand and optimise” the soon-to-be DP World Tour and at the same time “modernise and enhance the golf ecosystem”.
The meeting concluded with a list of actions, which, according to the minutes, included Pelley presenting proposals from SLG back to the European Tour board and members, and brokering a meeting between Yasir Al-Rumayyan and Jay Monahan with a view to “enabling an integration pathway”.
[Note: Pelley disputes this last point. “I wouldn’t say it was emphatic as that,” he told us in July. “There was a suggestion by DP World for all parties to meet but the caveat I put on it was that it would be positive if there was a willingness not to push a new league. I didn’t think that would be productive.”]
On July 9, the minutes from the summit in the Med were shared with all attendees. The same day, representatives from SLG and the European Tour met again, this time at The Grove golf resort near London. Attendees included Al-Rumayyan, Pelley and R&A chief executive Martin Slumbers. bunkered understands that SLG had hoped David Williams, the chairman of the European Tour would attend, but he did not.
During that meeting, SLG representatives outlined their vision to Slumbers. According to somebody with direct knowledge of this meeting, it was all about influence and commercial alignment. “If the establishment had concerns,” they told us, “we’d bring them inside the tent.”
Part of this presentation also outlined how SLG would benefit charitable causes. It showed how franchises are mandated to deliver a minimum of $3m per season, events a minimum of $2m per event, and the Team Championship a minimum of $5m. The title partner naming rights at six regular season events were also to be reserved for charity partners, along with the presenting partner rights for six regular events. The thirteenth event, meantime, was mandated to carry a charity as its presenting partner. “They are all commercial rights that you could sell for hundreds of millions of dollars per year,” said our source. “But Yasir said no. Instead, he wanted to create a pathway towards doubling what the PGA Tour does for charity.”
bunkered has been told that Slumbers believed the proposed schedule was too US-centric and needed to be more global.
SLG officials countered with their belief that they would get there commercially anyway. Indeed, the schedule for 2023 was originally going to have a ten-four split in favour of events in the US but that has since moved to nine-five.
Subsequent to the meeting at The Grove, SLG and the European Tour had a phone call to follow up on the actions listed in the minutes from Malta. Pelley advised that he hadn’t yet spoken to Monahan and suggested putting a pause on further talks until he had.
That was the last formal dialogue between the two parties.
On August 3, 2021, the European Tour and PGA Tour went public with more details around their strategic alliance.
By this point, SLG had pivoted – privately, at least – to a new identity. The controversy caused by the European Super League, which launched in April 2021 with a view to radically overhauling the existing football ecosystem, prompted the team behind SLG to distance themselves from the term ‘Super League’. Instead, the organisation incorporated itself as LIV Golf Investments in June 2021, LIV being the Roman numerals for ‘54’.
Undeterred by the European Tour and PGA Tour’s apparent reluctance to work with them, LIV officials pressed ahead with their plans. Having opened discussions with target players at the Saudi International in February 2021 – “If you were to write a list of the top-20 most commercially successful golfers at that time, that’s where we started” – one of the next items on their agenda was appointing somebody to lead the new venture.
There was only one name on the shortlist: Greg Norman. The Australian’s name had first come up in discussions around March of 2021. LIV officials were drawn to him for a number of reasons: he was a multiple major champion; a world No.1 for 331 weeks; he had won golf tournaments around the world; he was ‘a bit of an icon’ in the game; he was an accomplished businessman; and, of course, he had experience of trying to launch a new tour, way back in 1994. He was the obvious fit.
In May 2022, Jack Nicklaus told golf writer Michael Bamberger that he turned down “something in excess of $100m… to do the job probably similar to the one that Greg Norman is doing.”
Not so, according to senior LIV figures. bunkered understands that Nicklaus held three meetings with LIV to better understand what their plans were. At no point was he offered – or considered for – the chief executive or commissioner’s role.
What he was offered was equity in a team that he would be the owner of and which would be called the ‘Golden Bears’. The prospect of naming the individual champion’s trophy after him was also on the table. “But he was never considered or discussed as commissioner,” a senior LIV figure told us. “He also wasn’t offered $100m. It was way less. Could the total value, through team equity and such like, reach $100m? Absolutely. But he was not offered $100m. It was a fraction of that.” After much deliberation, Nicklaus formally rejected the offer from LIV in May 2021.
On October 29, 2021, Norman was unveiled as the CEO of LIV Golf Investments. Within the two-page press release was the announcement of a ten-year commitment from LIV of at least $200m to underwrite ten new full-field Asian Tour events, to be held in Asia, Europe and the Middle East.
“This is only the beginning,” Norman was quoted as saying. “LIV Golf Investments has secured a major capital commitment that will be used to create additive new opportunities across worldwide professional golf.”
On November 9, the European Tour announced that it had signed a new partnership with DP World. The deal, which included naming rights for the tour, would lead to prize funds exceeding $200m for the first time, with a schedule of at least 47 tournaments in 27 different countries lined up for 2022.
Whilst many publicly speculated that this would be the end of LIV, the team behind the new entity had other ideas. They continued to build behind the scenes with a series of C-Suite appointments, including the recruitment of Atul Khosla from the Tampa Bay Buccaneers to be LIV’s new president and Chief Operating Officer. On February 1, they announced a partnership with the Asian Tour, which included the creation of a ten-strong International Series, with purses ranging from $1.5m to $2m.
The same week, at the Saudi International, they pressed ahead with player recruitment. Officials met with more than 30 golfers on a yacht moored close to Royal Greens Golf Club where they outlined their vision for the league and left having agreed deals – some in principle, some in writing – with more than a dozen. Fundamentally, most players had the same three questions: Will I be banned from playing on other tours? Will I still get to play in majors? And will I get OWGR points? Satisfied that they had been able to allay those concerns as much as possible, LIV officials left the Saudi International believing that they would soon be in a position to launch with details of the first 20 players.
Then, on February 18, the mother of all spanners was thrown into the works. US golf writer Alan Shipnuck released comments made to him by Phil Mickelson in which the six-time major champion described the Saudis as “scary m****rf****rs to get involved with”. He added that he was only using LIV to gain leverage over the PGA Tour.
That threw the tour’s launch into disarray. Dustin Johnson distanced himself from LIV in a statement released by the PGA Tour. Bryson DeChambeau publicly committed his future the PGA Tour. Rory McIlroy declared it “dead in the water” and, for a time, it looked as though it might be.
Reeling from Mickelson’s remarks, officials took stock before deciding, in mid-March, to launch a ‘beta’ season comprising eight events and starting at the Centurion Club, near London, in June. They shelved plans to have the same 48 players playing in every event and for all teams to be fully folded-in from the get-go. Instead, they decided to open entries – with a full matrix of exemption criteria – and see who wanted to take part.
By the time entries closed, 172 players had submitted applications. That was condensed into a 48-man field and, at 2pm on June 9, the first competitive balls were struck. Against all odds, LIV had launched.
* * *
EIGHT EVENTS, 24 WEEKS and thousands of column inches later, LIV’s first season ended in Miami in October 201. There was controversy, litigation, public tête-à-têtes and, amongst it all, some golf, too.
Now, focus is shifting to Year Two, a year in which the primary objective for LIV is to start building out its team element. Widely derided, this is where the organisation believes the biggest return on investment exists. That’s critical. Bear in mind, it’s called the Public ‘Investment’ Fund for a reason.
But how will it recoup its money? That’s the multi-billion-dollar question.
The first thing to understand is that LIV has the luxury of a longer lead time than a quote-unquote ‘normal investment’.
“First and foremost, the PIF is viewing this as a business investment,” a senior figure in LIV Golf told us. “They are a sophisticated investor who are looking at this with a long-term perspective. That’s partly because there are a lot of moving parts. We’re dealing with an industry that hasn’t experienced this kind of change in decades. Fortuntely, the PIF fully appreciates that and accepts that there is a real opportunity here to do something exceptionally innovative and impactful.”
The next part to understand is the opportunity LIV believes it has identified. It believes that, at present, professional golf is a disjointed business. The way it has been explained to bunkered is that the DP World Tour sanctions – or co-sanctions – around 42 events per year but only owns the commercial rights to eight, amongst them the Scottish Open, Irish Open, BMW PGA Championship, Portugal Masters and the DP World Tour Championship.
“Every other week, there is promoter who underwrites that event and who tries to bring in their own sponsorship,” a LIV insider told us. “They basically run their own P&L for seven days. There are zero economies of scale and zero efficiencies across that because, once your four days are up, it’s on to the next one. LIV, very simply, has the scale to do 14 super-events.”
LIV believes that it has the capacity to reduce what it sees as ‘wastage’, introduce commercial consistency and guarantee the product. “What we’ve said is, for 14 weeks, we’ll guarantee the players because we’ve paid them all. They’re all contracted. We control the broadcast. Same as F1 and PL. With F1, there is somebody sitting in the TV booth saying, ‘We haven’t seen enough of Heineken today. It’s on corner six. Show more of that and less of corner eight because Emirates is getting too much.’ Done. That way you can guarantee commercial value. And because you have consistency of players, you also create more superstar value and improve scarcity value on things such as front-of-hats.”
In effect, LIV Golf believes that a more streamlined and cleaner product will drive greater value from prospective sponsors but it is doing so with what it insists is an ultra-conservative approach.
“Teams have never existed in golf, so it will take time for them to become established. That’s the same for the event and league commercials, and these will each reach commercial maturity at different times. That’s fine. That’s what the funding is based on. We might get there quicker than forecast – there are some teams that might actually reach commercial maturity next year because they’re just total no-brainers – but we’ve modelled conservatively.”
Risks and unknowns abound, not least will the (exceptionally important) team element take off? There has been talk of ‘home’ courses being built specifically for the franchises. Think No.16 at TPC Scottsdale on an epic, international scale, with golf academies tethered to each. The plans are hugely ambitious.
Whether or not they are realised may hinge on television. LIV already has a number of TV deals in place in countries around the world – for example, ServusTV in Germany and Austria, Eleven Sports in Italy, Claro Sports in Latin America, and CHCH-TV in parts of Canada – but cracking the American TV market through its partnership with the CW Network is, as our insider puts it, a huge priority.
“Our product has been extremely well received so far,” added our source. “It looks and feels different and is undeniably additive to the game of golf as a whole.
“Clearly, getting on TV in the US is extremely important, partly because of the revenue opportunities but also because it lends credibility and shows a level of acceptance.”
Love it or loathe it, LIV isn’t going to disappear anytime soon.
As our insider told us: “This hasn’t just been built for the long haul. It has been built for the betterment of the game itself.”
So, buckle up. Things are about to get even more interesting.
bunkered approached the DP World Tour for comment in light of some of the claims made about them in this piece by LIV sources. A spokesperson for the tour said: “Due to ongoing legal proceedings, it would be inappropriate for us to comment on the details of these claims at this time, other than to state they contain numerous inaccuracies. The reality is that we had a good working relationship with Golf Saudi and we explored a number of sponsorship opportunities with them, incremental to the sanctioning of the Saudi International. None, however, went beyond conceptual discussions and were never formalised.”
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This feature first appeared in issue 198 of bunkered (December 2022). For details of our latest subscription offer, click here. International subscriptions also available.
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