[Oil Money on the Green]③ "Greens Swayed by Money"... The Changing Global Golf Ecosystem

Merger Between PGA and LIV Stalls
Saudi Capital Expands into Soccer and eSports
Profits from Hosting Top-Tier International Sports Events
Criticism of Sportswashing and Loss of Fairness and Legitimacy

After making its debut in 2021, LIV Golf established a full-fledged system the following year. Backed by an investment from Saudi Arabia's Public Investment Fund (PIF), it quickly rose to prominence as a new tour. PIF is the world's largest sovereign wealth fund, with assets totaling approximately $930 billion. Its governor is Yasir Al Rumayyan, who also heads the Saudi state oil company Aramco. Leveraging its immense financial power and network, PIF has extended its influence throughout the global sports industry.

LIV Golf used its financial resources to attract top-tier players from around the world. Former world number one Jon Rahm (Spain), as well as "Hulk" Bryson DeChambeau and "major hunter" Brooks Koepka (both from the United States), left the PGA Tour after receiving massive transfer fees. During this process, LIV Golf and the PGA Tour became embroiled in a legal battle.

US President Donald Trump said he could resolve the merger issue between LIV Golf and the PGA Tour in 15 minutes, but there is no news of an agreement yet. Reuters·Yonhap News

The two organizations, once fierce rivals, announced a merger in June 2023, shocking the golf world with completely unexpected news. Along with the merger announcement, all ongoing lawsuits were dropped. Despite pouring in oil money, LIV Golf failed to achieve commercial success. On the final day of the LIV Golf season finale in Chicago in September last year, only 89,000 households tuned in, a figure far below the 657,000 households that watched the Solheim Cup, a women's golf competition, during the same period.

This year, LIV Golf has been expanding its influence by hosting tournaments in Asian countries such as Australia, Korea, Hong Kong, and Singapore, but the impact has been limited. In March, the final round of the PGA Tour's The Players Championship drew an audience of 3.6 million viewers. In contrast, the final round of the LIV Golf Miami event in April attracted only around 400,000 viewers.

In need of a breakthrough, LIV Golf reached out to the PGA Tour. Initially, PGA Tour players such as Rory McIlroy (Northern Ireland) strongly criticized LIV Golf, but later expressed support for the merger between the two organizations.

PIF agreed to invest $1.5 billion (about 2.1 trillion won) in PGA Tour Enterprises, the for-profit business arm of the PGA Tour. In return, it was expected that Al Rumayyan, the PIF governor and head of LIV Golf, would serve as co-chairman of the PGA Tour Enterprises board.

Yasir Al Rumayyan, Governor of PIF, is the key figure leading LIV Golf. Photo by AFP and Yonhap News

However, two years after the merger announcement, integration between the PGA Tour and LIV remains stalled. The PGA Tour is not in urgent need of funds, having secured a $3 billion (about 4.2 trillion won) investment from Strategic Sports Group. As a result, there is no longer a pressing reason to rush the merger with LIV Golf.

Obstacles have emerged along the way. Less than a month after the merger was announced, the US Department of Justice launched an antitrust investigation to determine whether the merger violated antitrust laws. Mediation efforts by US President Donald Trump, who has close ties to LIV Golf, also failed to yield results. Even before taking office, President Trump had boasted that he could resolve the integration negotiations between the PGA Tour and LIV Golf in just 15 minutes.

In fact, President Trump attempted to mediate between the two organizations. Immediately after his election, he called together PGA Tour officials such as Commissioner Jay Monahan, Tiger Woods (USA), Adam Scott (Australia), and LIV Golf's Al Rumayyan to discuss the merger. Although it seemed the merger would proceed rapidly, there has been little progress so far. President Trump has since changed his stance, saying, "The merger negotiations between the PGA Tour and LIV Golf are more complicated than the peace talks between Russia and Ukraine."

Even while merger negotiations were ongoing, both organizations continued efforts to develop their own tours. LIV Golf reportedly made significant efforts to recruit world number three Xander Schauffele (USA). Meanwhile, the PGA Tour announced the launch of a Future Competition Committee to design a new competitive system, appointing Woods as chairman. Brian Rolapp, the new PGA Tour CEO and former NFL executive, declared, "We will redesign tour operations from scratch."

The merger between the two organizations is expected to take some time, as most of the key figures who led the negotiations have stepped down. Ed Herlihy, chairman of the Policy Board, and Jimmy Dunne, a Policy Board member who designed the merger agreement, have left the PGA Tour. Of the three signatories to the merger agreement, Keith Pelley, then head of the DP World Tour, has resigned, and Commissioner Monahan will step down at the end of this year. The only person who still retains his influence is Al Rumayyan, the head of LIV Golf. This makes it difficult for the negotiations to gain momentum.

Of course, Saudi Arabia wields enormous influence in sports beyond golf. The kingdom has invested in a wide range of sports, including soccer, Formula 1, esports, boxing, UFC, tennis, and WWE. In particular, Saudi Arabia has become a major player in the soccer market. The Saudi Super League stunned the global soccer world by signing superstar Cristiano Ronaldo (Portugal) for the 2023/24 season. Following Ronaldo, other world-class players such as Neymar (Brazil) have flocked to Saudi Arabia.

The Saudi Super League has continued its aggressive spending on player acquisitions this season. Notable signings include Argentine striker Mateo Retegui, Darwin Nunez (Uruguay), Joao Felix (Portugal), and Kingsley Coman (France). Saudi Pro League club Al Qadsiah brought in Retegui, Christopher Bonsu Ba (Ghana), and Gabriel Carvalho (Brazil), with total expenditures reaching 116.06 million euros (about 188.5 billion won). This spending ranks 15th among clubs worldwide, including those in Europe.

Saudi Arabia is using sports to improve its global image. Additionally, the country aims to build a global brand image through sports as part of its efforts to move away from an oil-dependent economy. Crown Prince and Prime Minister Mohammed bin Salman is leading this initiative. He is the most powerful figure overseeing "Saudi Vision 2030," which aims to increase non-oil sector revenue sixfold. Sports are a key part of this strategy.

Soccer superstar Cristiano Ronaldo is serving as an ambassador for Saudi sports promotion. Photo by AFP and Yonhap News

Since 2016, Saudi Arabia has established more than 70 sports organizations. Over the past nine years, it has hosted more than 100 top-tier international sports events. Despite the massive spending, PIF reportedly earned $36.8 billion (about 51 trillion won) in revenue in 2023.

Saudi Arabia has successfully secured the hosting rights for the 2034 FIFA World Cup and the Summer Asian Games. In 2027, the country will co-host the Esports Olympics with the International Olympic Committee (IOC). That same year, it will host the Asian Cup, followed by the Winter Asian Games in 2029 and the 2030 Expo. Saudi Arabia is also bidding to host the 2026 Summer Olympics. In addition, the kingdom is focusing on developing its tourism industry, diversifying its economy, and expanding its political and diplomatic influence. The number of tourists visiting Saudi Arabia is around 40 million, and this figure is expected to rise to 150 million by 2030.

However, there are limitations. Saudi Arabia has long been criticized as a haven for corruption and human rights abuses. The Saudi monarchy faces accusations of using sports to launder its negative image, a practice known as "sportswashing." This could foster the misguided perception that money can solve everything. It also risks undermining the core values of sports, such as fairness and legitimacy. Saudi Arabia's sports policy is not immune to criticism.