One guy's take on the merger.
Won't let me paste Mickelson's tweet praising the below for some reason.
Phil Mickelson
https://twitter.com/PhilMickelson
Jul 6
This thread is a long and accurate FULL truth(not half truth) of the LIV/PGA Tour agreement if you’re interested. Well done BobBall and thank you.
A message to the players of the PGA Tour.
You are all in trouble & screwed if you don’t support the Framework agreement. I’ve signed similar frameworks with institutional capital, so I also want to tell you what’s really going on with the agreement. I didn’t want to get into the Framework Agreement when it came out because I knew it would be exhausting to engage. It’s designed to be vague in part. Literally, the golf press (sic) and pundits that have gotten everything wrong for the last year were destined to get it wrong again and worse yet, people keep listening to them because it’s all they have in the golf world - no real journalists. It’s been painful to watch. I kid you not,
@RichEisenShow actually had on
KVanValkenburg from
@NoLayingUp as his expert on contractual agreements to explain the Framework. Of course, KVV got it sideways. It’s not his fault & who can blame him for wanting free face time. All of the nonsense that PGA Tour brass is going to get rid of LIV when they are in control is a fool’s wish. The Framework has key points that haven’t been understood and reported correctly.
First, H.E. Yasir Al-Rumayyan will firmly be in control but wants to leave the day-to-day decision making and operations of the different Tours to skilled professionals. KVV got that part correct. Al-Rumayyan’s position as board chair & his first right of refusal for new investment capital are also very important but the real control comes from this key line: "PIF's investment in NewCo, which will include customary protections and standard governance terms for a non-controlling voting interest (including veto/consent rights and preemptive rights for PIF in the event of a future capital raise by NewCo and customary drag/tag rights and transfer restrictions)."
Anyone that's sought institutional investment and signed a final agreement knows what this means. You (PGA Tour) get an investor (PIF), and they now own part of your company that you manage. But,
there is a list of things you can't do without the investor’s consent. Those are called "veto/consent rights.” Having signed and negotiated similar documents, I see it pretty clearly; Al-Rumayyan's list will be long (I’ve seen long ones) and will include that LIV cannot be shuttered unless he approves. The new board won’t have the power to sell anything, spend a certain amount of money, enter into certain types of binding agreements, merge with another tour, sign contracts over certain dollar amounts, or come close to even touching LIV without PIF’s consent. Seeing
@SharkGregNorman and Al-Rumayyan laughing it up while driving around in their golf cart last week & Norman giving H.E. (His Excellency) a putting lesson speaks volumes. They are being purposefully quiet.
For clarity it was reported that Al-Rumayyan told team captains last week that LIV is here to stay. Take that to heart.
Second, actually read the part about “assessing” and “empirically evaluating” PIF by the executives of NewCo.
It says they will evaluate it but everyone has left off the second part which says, "
PIF, the PGA TOUR and the DP World Tour will work together in an effort to determine how best to integrate team golf into PGA TOUR and DP World Tour events going forward." PGA Tour sycophants twisted this because Jimmy Dunne deftly left the second part out to stop the pitch forks and tar coming from players after the announcement. This whole clause is in there to protect LIV, make LIV better, and to mandate cooperation.
It says the PGA Tour leadership will assess LIV but it also requires them to figure out how make it better and integrate. He’s requiring them to use all of their knowledge and skills to make LIV teams valuable. Maybe the name and other things will change but LIV always said they would adapt and change whether they merge or not (cue PGA Tour execs that it’s good to embrace change while holding onto some traditions.)
Before Al-Rumayyan put a dime into LIV, PIF created a plan where they budgeted everything down to the paperclips. That happened and it’s a 10-year plan. They expected to lay out capital knowing returns come much later (like all private equity investments into companies.) They did massive empirical due diligence on Norman’s idea and used numbers to look into the overall golf market, starved markets (Adelaide) and needed demographic changes.
Al-Rumayyan is requiring NewCo execs to do it properly instead of the ‘way we’ve always done it.’ This is what PIF does. They are extremely savvy investors. In other words, PIF already knows the answer to the empirical study and they know it will show that LIV is a way to bring golf to other parts of the world and get to the needed advertising demographic – younger people.
The biggest danger PGAT Tour players now face is the Agreement not going forward.
Monahan and Pelley have admitted PIF’s money really isn’t so bad and got caught previously seeking Saudi investment (see the court docs @desertdufferLLG brilliantly watched for and reported).
Just the announcement of a merger opened the floodgates to sponsorships, big TV contracts, and endorsement deals. Anyone having issues with PIF’s investment should read the heartfelt and intellectual post by
@NotDrJ that’s pinned on his profile.
If the Framework deal doesn’t go through, all of money is going to pour into LIV with absolutely no PGA Tour input or power to share. As I’ve previously said, LIV is the new Formula One of golf. The PGA Tour can be NASCAR but you are in danger of a deep slide backward.
You should also know that players that left for LIV ended up helping you and were far from traitors. They have saved you from the @eamonlynch and Jay Monahan types that have turned their noses up at you and think past Tour economics are fair (while Monahan has been flying in private jets & building lavish headquarter buildings.) Monahan & Co. are the ones that created this false fight with LIV that could have been avoided with real leadership.
On that note, real leaders don’t write up talking points expecting the GOAT
@tigerwoods to say what a hardworking and amazing leader you are. Monahan doing that is plainly weird & reminds me of Freud’s coined “leadership transference.” PGA Tour players have been guilty of transference and they only way they can leave is when they “manage” it. In other words, realize Monahan & Pelley are not good leaders and send them packing. Tiger’s response to the ‘greatness’ talking points was telling. Tiger’s strong and has managed.
If you have thought LIV players should face penalties to play on the PGA Tour again, believe me, they won’t when it’s all said and done. LIV players went out on a limb for you and yes, they got paid handsomely to do so, but those players have been classic, high-octane forces for positive change in golf. So, PGA Tour pros are in a tough spot. You now know your leadership is inept and drug the families of 9/11 victims into golf unnecessarily and didn’t even mean it. The court documents released show this and also that the DP World Tour isn’t financially viable.
The PGA Tour is borrowing money and using reserves to operate. The elevated events aren’t sustainable without a capital infusion. LIV is now going to get OWGR points (and the snarky emails about the Saudis from OWGR execs is duly noted in PIF land.) Non elevated tournaments will lose sponsors because not enough stars will go to them. TV revenue that’s based on OWGR points is going to plummet.
All of this is going to happen unless this gets fixed. It’s clear that PGA Tour events should continue with only a couple elevated events + LIV (and of course the majors.) Then it comes down to scheduling and the minutia. As a PGA Tour professional, you should be focused on finding new leadership. Monahan, Pelley, and their lieutenants need to go. You need leaders that want both LIV and the PGA Tour to thrive. In fact, those new leaders should champion LIV. You should say your prayers that LIV grows around the world, opening up new endorsement deals and advertising sponsorships. Of course these new leaders should be just as passionate about keeping the PGA Tour alive and thriving. They should respect the traditions of golf while fostering change.
Monahan, Pelley, and their teams have shown their cards (and lack of real leadership) and they lost. You are in deep trouble if you don’t embrace the Framework Agreement and new leaders that are passionate about LIV and the PGA Tour surviving and thriving. It will be interesting to see if Jimmy Dunne can dance the Potomac two step coming up. Health aside, Monahan surely couldn’t.
As a world class athlete, are you really going to leave your fate in the people that manipulated and lied to you?