Golfweek learned that the PGA Tour had narrowed down the list of companies it was considering as potential private equity partners for its new, for-profit entity. The list includes some of America’s most prominent financial figures. Five groups are still in the running to become the primary investor in PGA Tour Enterprises. This was formed with the announcement on June 6, 2006 of a Framework Agreement between the Saudi Arabian Public Investment Fund and the PGA Tour.
Five companies are still being considered: Fenway Sports Group, which is partnered up with investors Steven Cohen & Arthur Blank, Liberty Strategic Capital, Acorn Growth Companies, Eldridge Industries and a group of individuals referred to by the name Friends of Golf. Beyond the five groups that are bidding for the Tour’s primary private equity partner, there are still several other companies in the running as potential investors.
Eight sources that spoke to Golfweek about the issue requested anonymity as they were not authorized by their employers to make public comments. Mark Shapiro told Sportico that Endeavor, the sports and entertainment giant, had rejected its bid.
The PGA Tour board of directors will discuss the preferred options of the five groups of candidates, possibly as soon as next week.
One person who is familiar with the process said, “This is generally the plan. It may take some time.” The next meeting of the board will be held on November 12th in Ponte Vedra Beach (Florida).
FSG is the bidder with the best track record, as it owns the Boston Red Sox and Liverpool Football Club, both in the Premier League. It also owns NHL’s Pittsburgh Penguins. Boston Common, led by Rory McIlroy, is a team in the TGL indoor-golf league that the company recently invested in. FSG’s bid for the Tour has the support of New York Mets owners Steven Cohen and Arthur Blank. Arthur Blank owns the Atlanta Falcons NFL franchise, as well as the New York Mets. Cohen and Blank bought TGL teams this summer.
Arthur Blank, Atlanta Falcons owner, walks off the field during the second half of the Tennessee Titans game at Nissan Stadium in 2023. Steve Roberts/USA TODAY Sports is required credit.
Acorn Growth Company’s portfolio is based largely on the aerospace, defense and intelligence industries. The Tour’s U.S. centric investment focus could appeal to it as it tries to counter the claims of Sen. Richard Blumenthal, who claimed that the Saudi deal amounted to an hostile takeover by a foreign fund. Randall Stephenson is one of those who are attached to Acorn, including the former AT&T CEO, who resigned in July from the PGA Tour board citing concerns over working with Saudis.
Steven Mnuchin, former Secretary of the Treasury under the Trump Administration, is the leader of Liberty Strategic Capital, based in Washington, D.C. Todd Boehly is the CEO of Eldridge Industries. The company owns the Los Angeles Dodgers, and was part a consortium in May that bought the Premier League football club Chelsea. Sources claim that the Friends of Golf group includes a number of financial giants who share a love of golf, including Wall Street legends George Roberts, Henry Kravis and several others.
Sources familiar with this highly-guarded process have said that all the groups under consideration are more interested in a long-term partnership than a short-term return. Uncertainty surrounds the ownership structure or value that players could receive. A spokesperson for the PGA Tour refused to confirm details about the remaining private equity companies or comment on the current process.
Multiple sources claim that negotiations with the Saudi Arabian Public Investment Fund are sluggish, even though the private equity portion of a future deal has been increasing.
One source who has insight into the current situation said, “Less that zero progress.” Two sources say that the Saudis are waiting to see what the private equity component looks like, as they calculated that an agreement involving just the Tour and PIF could be subject to antitrust opposition from the Department of Justice.
According to the Framework Agreement, the Tour and PIF have until December 31 to come to a final agreement. However, this date is expected to be extended well into 2024.
