Documents filed in a US legal case have revealed that the PGA Tour regarded the European Tour Group (ETG) as an “underinvested and borderline distressed asset” during merger discussions last year. The 357-page filing, made in Florida, includes an executive summary recommending a merger with ETG, the parent organisation of the DP World Tour.
The proposed deal, which never materialised, would have cost the PGA Tour between $40m and $60m over five years via a “reserve fund”. The PGA Tour was particularly interested in gaining ownership of the European side of the Ryder Cup, described as “one of the most prestigious and respected events in all of golf”. The documents note that the ETG has a substantial financial commitment to IMG until 2037.
The analysis, presented to the PGA Tour’s policy board in June 2022, states: “Generally, we find ETG an underinvested and borderline distressed asset. The event model may be unsustainable, or at a minimum represents an unstable foundation.” The PGA Tour saw an opportunity to “simplify and streamline the flow of talent through a coordinated global schedule” and generate greater financial benefits from global media and sponsorship rights.
One year on, the PGA Tour and DP World Tour have reached a framework agreement to combine forces with Saudi Arabia’s Public Investment Fund, the main backer of LIV Golf. The PGA Tour did not respond to requests for comment, while the ETG declined to comment.
