Top players to get bulk of equity in new PGA Tour venture: reports

Masters champion Jon Rahm moved from the PGA Tour to LIV Golf in December despite merger talks between the two tours. (Patrick Smith)
Masters champion Jon Rahm moved from the PGA Tour to LIV Golf in December despite merger talks between the two tours. (Patrick Smith)

The PGA Tour's new for-profit entity will dish out over 80% of the initial $930 million of player equity grants to its top 36 golfers, according to a leaked memo reported by US media on Wednesday.

ESPN and Golf Digest both reported the contents of the memo from PGA Tour commissioner Jay Monahan, which had been distributed to players.

Last month, the tour announced a deal that could eventually be worth up to $3 billion with a group of billionaire sports team owners to create a new entity called PGA Tour Enterprises.

The move comes after the PGA Tour lost several top stars to the breakaway LIV Golf League, backed heavily by Saudi Arabia's Public Investment Fund (PIF).

Under the new program, players would collectively access more than $1.5 billion in grants that vest over time with SSG investing an initial $1.5 billion and the possibility of investing another $1.5 billion later.

In the memo, Monahan said that $930 million of initial player equity grants would be handed to 193 PGA Tour members.

A total of $750 million of that amount would go to the top 36 players based on career performance, including results over the past five years and their position in the Player Impact Program (PIP) which ranks how much a player is deemed to have impacted tickets, sponsorships, media consumption and fan engagement.

There are four groupings of players outlined in the memo with group two made up of 64 players who will share out $75 million based on performance over the last three years.

Group 3 includes 57 players dividing $30 million in equity, having earned certain fully exempt PGA Tour status categories.

The final grant would go to 36 players who "were instrumental to building the modern PGA Tour, based on career performance."

"All initial grants will vest over time and will require minimum participation (eg playing 15 or more events on the PGA Tour) and/or service requirements commensurate with the value of the grant" the memo stated.

ESPN said the memo also stated that tour will also award "recurring player equity grant" which will be incremental to the initial grants, and will be worth an aggregate amount of $600 million. Those grants will be awarded in $100 million totals each year, beginning in 2025 and through at least the 2030 season.

"These recurring grants will reward future top performers and will be based on last three-year performance, last year performance and Player Impact Program results," Monahan said in the memo.

SSG includes Fenway Sports Group, owners of English football's Liverpool FC, MLB's Boston Red Sox and the NHL's Pittsburgh Penguins, plus MLB New York Mets owner Steven Cohen and NFL Atlanta Falcons and MLS Atlanta United owner Arthur Blank.

The new company has yet to be created, however, but Monahan said he hopes that legal and regulatory matters will be resolved before March.

The PGA Tour remains in merger talks with PIF and it is unclear how the new structure would operate should such talks succeed.

LIV has continued to attract top players with reigning Masters champion Jon Rahm signing up in December for a deal reportedly worth between $300 and $600 million.