Senator Richard Blumenthal from Connecticut has opened an investigation into the PGA Tour’s merger with Saudi Arabia’s LIV Golf and the DP World Tour.
In a letter to PGA Tour commissioner Jay Monahan, Blumenthal wrote that the Tour’s agreement with Saudi Arabia’s Public Investment Fund raises concerns about “the risks posed by a foreign government entity assuming control over a cherished American institution.”
Senator Blumenthal also writes that the Tour’s stated plan to remain a tax-exempt nonprofit 501(c) (6) entity raises questions about “whether a foreign government may indirectly benefit from provisions in U.S. tax laws meant to promote not-for-profit business organizations.”
The Democratic senator has given a target deadline of June 26 for the PGA Tour to provide documents related to its planned merger and relationship with the PIF. Yasir Al-Rumayyan, governor of Saudi’s PIF, will be part of the executive committee of the Tour’s newly formed commercial entity with LIV Golf.
Previously critical of the Saudi government’s human rights violations, Monahan told PGA Tour employees that the league could not financially afford to continue its legal battle with LIV Golf. Costs had reached $50 million in legal fees, and the Tour dipped into $100 million of its reserves to pay for future scheduled legal troubles, according to the Wall Street Journal.
“We cannot compete with a foreign government with unlimited money,” Monahan reportedly said. “This was the time….We waited to be in the strongest possible position to get this deal in place.”
