The proposed merger between the PGA and Saudi Arabia-backed LIV Tours in professional golf is still “in enormous flux” because the parties are facing a six-month deadline to agree the final details of a deal, according to Ron Johnson, the senior Republican senator who is investigating it.
The deal has rocked the world of golf and prompted concerns among some lawmakers and human rights activists that – if the deal succeeds – it could mark the first of many takeovers of sports leagues and other cultural institutions by Saudi Arabia.
The kingdom has been accused of engaging in a relentless campaign of “sports washing” to try to shore up its image around the world despite its abysmal human rights record.
Johnson, who has started to review confidential documents that were received by the Senate’s permanent subcommittee on investigations on Tuesday, where he serves as the most senior Republican, told the Guardian in an interview that he understood “all bets were off” if the parties did not reach a final agreement about the merger by the end of 2023.
A five-page “framework agreement” was received by the Senate committee – and leaked to news outlets on Monday – following a request for documents by Johnson and Richard Blumenthal, the Democratic chairman of the committee.
The 10-point framework contains few new details of the proposed merger, except that the proposed agreement will terminate by 31 December 2023 if the parties fail to reach a “definitive agreement”. After that, parties would have to agree by “mutual consent” to an extension.
Johnson said that the only binding agreement the parties have made so far was to end their longstanding – and expensive – litigation that has kept the parties locked in court for years.
The five-page agreement was only a small portion of the documents that have been received by the permanent subcommittee on investigations. Johnson said his office had received about 300 pages of documents from the PGA and about 16,000 from “the Saudis”, a reference to the Saudi sovereign wealth fund, the Public Investment Fund.
“If they don’t agree to things by the end of this year – except for the lawsuits – they will just keep doing what they were doing and the future of golf remains uncertain,” Johnson said. Describing himself as an avid golfer, Johnson added that he believed that the litigation had represented an “existential” threat to the PGA, which was trying to fend off the PIF’s $700bn war chest.
The proposed merger of LIV Tour and PGA, which shocked the world when it was announced earlier this month, has received a frosty reception on Capitol Hill, where it is facing questions not only from Blumenthal, but also the Senate finance committee.
It is not yet clear whether parties that have been invited to testify – including the PIF governor, Yasir al-Rumayyan – will agree to face questions. The PIF has previously argued that al-Rumayyan is a Saudi government official and should therefore be granted sovereign immunity from legal depositions.
In a statement, Blumenthal said the tentative agreement that had been made public in the press “raises more questions than it answers”.
“I look forward to receiving more information about what this agreement means for players and fans, how it was developed, and what remains to be finalized at our hearing in July,” Blumenthal said.
A hearing has tentatively been scheduled for 11 July.
The PGA said in a statement: “Following the recent resolution of litigation, we’re working toward a definitive agreement. Any potential agreement resulting from these negotiations will have to be approved by the full board of the PGA Tour, including our Player Directors.”
