US justice department to investigate Saudi-backed PGA-LIV Golf merger
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The Justice Department has notified the PGA Tour that it will review the US golf operator’s planned merger with Saudi-backed LIV Golf for antitrust concerns, the Wall Street Journal reported on Thursday.
The PGA Tour and LIV Golf, which is backed by Saudi Arabia’s Public Investment Fund (PIF), shocked the world of sports and some US policymakers last week when they announced a partnership that ended a blistering legal dispute between them.
The surprise deal prompted calls from some US lawmakers for the Department of Justice to probe the deal, citing concerns over Saudi Arabia’s human rights record and competition in the game of golf.
On Tuesday, Democratic Senators Elizabeth Warren and Ron Wyden called for the Justice Department to scrutinise the deal, in a letter to attorney general Merrick Garland and assistant attorney general Jonathan Kanter.
"The deal appears to have a substantial adverse impact on competition, violating several provisions of US antitrust law, regardless of whether the deal is structured as a merger or some sort of joint venture,” the lawmakers said.
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“The PGA-LIV deal would make a US organization complicit – and force American golfers and their fans to join this complicity – in the Saudi regime’s latest attempt to sanitize its abuses by pouring funds into major sports leagues,” they added.
PGA Tour commissioner Jay Monahan was asked last week - when he appeared in an interview on CNBC to announce the deal alongside PIF governor Yasir al-Rumayyan - whether he was concerned about an anti-trust violation.
Monahan said the deal didn’t violate antitrust regulations. But according to the WSJ, people familiar with the agreement said it wouldn’t be surprising if the justice department examined the deal.
Previous comments Monahan made could be honed in on by investigators, including statements the PGA chief made to reporters that it would be good for the Tour “to take the competitor off of the board, to have them exist as a partner, not an owner”.
The deal has also prompted action from some lawmakers.
On Monday, Democratic Senator Richard Blumenthal, who chairs the Homeland Security investigative subcommittee, opened a probe into the deal, demanding a trove of documents from the leagues.
John Garamendi, a California Democrat, has also revived a bill that would revoke the tax-exempt status of professional sports leagues such as the PGA Tour.
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