View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. News
  2. Events
June 29, 2022

PGA and DP World Tours strengthen strategic alliance in face of LIV threat

Golf’s PGA Tour and DP World Tour have responded to the threat of the Saudi-backed fledgling rival LIV Golf circuit by announcing an expanded and “strengthened” strategic alliance.

By Tariq Saleh

Golf’s PGA Tour and DP World Tour (formerly the European Tour) have responded to the threat of the Saudi-backed fledgling rival LIV Golf circuit by announcing an expanded and “strengthened” strategic alliance through a new 13-year operational joint venture partnership.

The tie-up, which will run through to 2035, builds on the existing alliance between the two tours that was unveiled in November 2020.

As part of the new joint venture, the PGA Tour will increase its existing stake in European Tour Productions (ETP), which produces and distributes the tour's content internationally, from 15% to 40%.

ETP was a joint venture between the European Tour and the IMG agency but has been 100% owned by the tour since 2017. It has continued to work alongside IMG Media in producing and distributing coverage of the European Tour, the Ryder Cup, and the British Open major.

The DP World Tour will also increase annual prize funds for its members for the next five years, all above the record 2022 levels unveiled as part of the title sponsorship agreement with DP World, the Dubai-based international trade enabler, last November.

The new joint venture will also provide “additional competitive opportunities for professional golfers of both tours and also establish a clearly defined pathway for top players around the world.”

Players from the Sunshine Tour and PGA Tour of Australasia, with whom the DP World Tour already has existing strategic alliances, will now have a formal pathway to the DP World Tour.

Meanwhile, DP World Tour members will have direct and formal access to the PGA Tour.

To achieve that, from 2023, the top 10 players on the end of season DP World Tour rankings [in addition to those already exempt] will earn PGA Tour cards for the following season.

The golf organizations claimed that “working together to drive prize funds and commercial revenue will not only benefit the entire range of both memberships immediately but also develop immense strategic opportunities for all members of both tours for the future.”

Additionally, the DP World Tour will work closely on the development and implementation of the new international events announced by PGA Tour commissioner Jay Monahan last week at the Travelers Championship in Connecticut, and DP World members will gain access to those events.

Through the initial partnership in 2020, the PGA Tour and DP World Tour have worked together on strategic commercial opportunities including collaborating on global media rights in certain territories.

The two tours have also worked in partnership on global scheduling, prize funds, and playing opportunities for the respective memberships.

Notably, the respective organizations have collaborated on the co-sanctioning of the Scottish Open event on the DP World Tour, alongside access for both memberships to the Barbasol Championship and the Barracuda Championship on the PGA Tour.

The DP World Tour has used the partnership to secure new tournament title sponsors such as Korean car brand Genesis and biotechnology company Horizon and new tour partners including cybersecurity firm Fortinet and tech company Velocity Global.

Keith Pelley, chief executive of the DP World Tour, said: “Building on the success of the existing strategic alliance between ourselves and the PGA Tour, this move will significantly enhance the meritocracy that has successfully served the professional game on both sides of the Atlantic for more than 50 years.

“It is a natural extension and progression of what we have been doing over the past few years and I passionately believe that this move is the right thing for our players, our tour, our fans, and the game of golf in general.

“Our two tours have undoubtedly drawn closer over the past few years and this announcement strengthens both tours for the betterment of both memberships.”

Monahan added: “It was clear from the outset that our strategic partnership with the European Tour Group was a powerful agreement for both sides, and we are thrilled with the announcement of this expanded partnership.

“We will continue to collaborate on a global schedule and key commercial areas as we draw our organizations and memberships even closer together.”

The expanded partnership between the two tours is likely to intensify talk of a merger that has been ongoing for a few years, particularly with the emergence of LIV Golf and the defection of several top players to the new circuit.

Brooks Koepka recently became the latest high-profile player to quit the PGA Tour and join the new series, joining the likes of Dustin Johnson, Bryson DeChambeau, and Phil Mickelson.

The PGA Tour has suspended players that have made the switch.

LIV, which is backed by Saudi Arabia's Public Investment Fund, staged its inaugural Invitational Series in London earlier this month and will hold its first US event tomorrow (June 30) in Portland.

In other efforts to combat the threat from LIV, the PGA Tour recently revealed plans to revamp its schedule and increase prize money at marquee events.

The tour will increase the purses to $20 million in at least eight existing major events in the regular season and establish a new, lucrative fall schedule for the top 50 finishers in the FedEx Cup standings.

The DP World Tour also recently confirmed sanctions against members who participated in the LIV Golf event after not receiving releases to do so.

The players will be fined $100,000 and are suspended from participating in the Scottish Open and Barbasol Championship (July 7-10) and the Barracuda Championship (July 14-17).

The tour also stated that “participation in a further conflicting tournament or tournaments without the required release may incur further sanctions.”

LIV Golf will reportedly reimburse players for any fines they receive and also cover legal costs if they choose to challenge suspensions.

Sergio Garcia, Lee Westwood, Ian Poulter, Laurie Canter, Martin Kaymer, and Louis Oosthuizen are among the DP World Tour players that featured in the debut LIV event.

Pelley revealed that he had met with the LIV Golf organizers last year to discuss a potential collaboration but reiterated that he had not met LIV representatives at the Centurion event.

He said: "In July of 2021, in Malta, we viewed an unsolicited presentation from [Performance54], the marketing agent representing Golf Saudi. In our September board meeting that year we showed the details of that presentation to the board.

"After a discussion, in our assessment, we realized the numbers were less compelling than Raine Capital and the [Premier Golf League] proposal we turned down nine months earlier.

“Out of respect for all parties involved I'm not going to go into detail about the figures, but you have to trust myself and the board that materially this was not a good deal for the European Tour and its members.

"Most importantly, and this is most importantly, it was nowhere near the figures being bandied about in the media and in the players lounge over the past couple of months. We have had no further conversation with them since last summer. I was not in Centurion. I was in Sweden.

"We have been totally focused and we have focused on the, as I said, the complexity of two members' organizations coming together.

“[This] has required a tremendous amount of resolve, unwavering commitment and work with our respective teams. That has been our primary and our only focus and I'm proud of where we've gotten to today."

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to your inbox every weekday. The industry's most comprehensive news and information delivered to your inbox every Thursday.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Sportcal