Report: PGA Tour's strategic alliance with DP World Tour 'a sore point' for SSG

The strategic alliance between the PGA Tour and the DP World Tour is now 'a sore point' for the billionaire investors of the North American circuit, according to a report. 

A "strategic alliance" between the PGA Tour and European-based circuit was first announced in 2020 and extended two years later amid the threat of the PIF-backed LIV Golf. 

Part of the deal, penned in 2022, saw the PGA Tour increase its stake in European Tour Productions from 15% to 40%. 

Other key aspects of the partnership saw the arrival of co-sanctioned tournaments, cross-pollination between the tours and the underpinning of prize purses for DP World Tour events. 

Under the terms of the deal, the PGA Tour can reportedly walk away from the alliance in two years' time or renegotiate.

Golfweek are reporting that the price tag to remain and consolidate its equity stake with the DP World Tour could "creep into the nine figures" and is "a sore point" for the Strategic Sports Group (SSG). 

SSG is a consortium of American sports team owners that agreed a $3bn private equity deal with the PGA Tour last January. 

It is led by Fenway Sports Group, the parent company of the Boston Red Sox and Premier League football team Liverpool FC. 

The PGA Tour has vowed to make significant changes over the next few years and, obviously, SSG want a return on their investment. 

Brian Rolapp, the Tour's recently-hired chief executive who will eventually replace commissioner Jay Monahan, has already articulated his desire for a complete overhaul. 

Just this week, he hired two former NFL executives to the senior leadership team. 

Elsewhere, Tiger Woods has been deployed to chair a 'future competition committee' that is charged with redesigning the regular, postseason and offseason that best serves the players, fans and partners.

There have been calls by some high-profile players, such as Rory McIlroy, to embrace a more global outlook and co-sanction more national opens. 

But Golfweek's Eamon Lynch has suggested SSG's vision for the future of the PGA Tour doesn't currently extend beyond the United States.

In his recent column, he wrote:

Under the terms of that alliance, Ponte Vedra is now spending a significant sum to guarantee purses on the DP World Tour. In 2027, the PGA Tour can force a deal renegotiation or exit. According to two sources, the price tag to remain and consolidate its equity stake could creep into nine figures, which is a predictable sore point for the SSG investors, whose ambitions don’t yet show evidence of extending beyond U.S. borders. And guys who are unconcerned with elevating the game globally (much less with sportswashing), or who view things only through the prism of commerce, might see Saudi Arabia’s Public Investment Fund as a welcome hedge for that obligation.

What would happen if the PGA Tour walked away from the strategic alliance?

That is a very good question. 

Plenty have suggested the DP World Tour should seek an agreement with Saudi Arabia's Public Investment Fund, which is the primary backer of the LIV Golf League. 

The breakaway tour are still without world ranking accreditation and is doubling down on their existing relationship with the Asian Tour.

Officials from the DP World Tour previously met with PIF officials in July 2021, a few months before the unprecedented disruption in the men's game began.  

Keith Pelley, who was the chief executive at the time and later replaced by Guy Kinnings, previously stated that no offer was ever made. 

"I know that many people still quote the Malta meeting and the supposed $1bn offer that was made to us by Golf Saudi, which is a large part of the reason behind the claim that we missed an opportunity with the Saudi," Pelley previously said. 

"There's only one word to describe that claim, and that is fictitious. I genuinely do not know how many times I can make this point. 

"And you can ask any member of our board of directors, and they will unanimously confirm that it was not an offer, it was not a deal, it was merely a marketing presentation put together on behalf of Golf Saudi.

"I wish I could because it would put to bed all this speculation once and for all."