Memo details how PGA Tour plans to use $1.5B in new funding

Memo particulars how PGA Tour plans to make use of $1.5B in new funding

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The PGA Tour plans to distribute about 80% of $930 million value of preliminary participant fairness grants in its newly shaped firm, PGA Tour Enterprises, to 36 prime golfers based mostly on profession efficiency, outcomes over the previous 5 seasons and Participant Influence Program outcomes, commissioner Jay Monahan advised members in a memo on Wednesday.

The memo, a replica of which was obtained by ESPN, particulars how the PGA Tour plans to spend the $1.5 billion that Strategic Sports activities Group (SSG), a consortium of billionaire sports activities group homeowners, are infusing in PGA Tour Enterprises, a for-profit entity.

The PGA Tour and SSG introduced final week that they’d reached an settlement through which SSG would make investments as much as $3 billion into the brand new firm. Within the memo, Monahan stated one of many outcomes of the SSG partnership was an fairness program, “the place PGA Tour members could have the chance to change into direct fairness homeowners in their very own sports activities league — a first-ever step ahead in world sport.”

Monahan advised PGA Tour members that the Participant Fairness Program will grant over $1.5 billion in fairness in PGA Tour Enterprises to previous, present and future members over the following a number of years. Monahan wrote that this system is designed to “reward prime performing members and incentivize them to assist and construct PGA Tour Enterprises sooner or later; present a reward to a considerable portion of the present PGA Tour membership; and supply a reward to legends who helped construct the trendy PGA Tour.”

Beneath the plan, $930 million in preliminary participant fairness grants can be awarded to 193 PGA Tour members who will fall in certainly one of 4 classes:

  • Group 1 will include the highest 36 gamers who will share $750 million in combination fairness based mostly on profession efficiency, final five-year efficiency and Participant Influence Program (PIP) outcomes.

  • Group 2 will embody 64 gamers who will share $75 million in combination fairness based mostly on final three-year efficiency.

  • Group 3 will include 57 gamers who’ve earned absolutely exempt PGA Tour standing and who will share $30 million in combination fairness.

  • Group 4 will embody 36 gamers who have been instrumental in constructing the trendy PGA Tour, based mostly on profession efficiency. They may share $75 million in combination fairness.

Within the memo, Monahan stated gamers will solely obtain one preliminary grant and that they are going to vest over time, which would require minimal participation, comparable to enjoying 15 or extra occasions on the PGA Tour every season and/or “service necessities commensurate with the values of the grant.”

The tour may also award recurring participant fairness grants, which can be incremental to the preliminary grants, and can be value an combination quantity of $600 million. These grants can be awarded in $100 million totals every year, starting in 2025 and thru a minimum of the 2030 season.

“It is very important observe that every one PGA Tour members are eligible to obtain recurring grants — no matter whether or not or not they obtained an preliminary grant,” Monahan wrote within the memo. “These recurring grants will reward future prime performers and can be based mostly on final 3-year efficiency, final yr efficiency and Participant Influence Program outcomes.”

Monahan stated the tour hoped to complete finishing its authorized and regulatory necessities by mid-March and that gamers would be told of their particular person fairness issuances “instantly thereafter.”

“We’re enthusiastic about this historic second in PGA Tour historical past, and I sit up for partnering with each participant as we develop the PGA Tour now and sooner or later,” Monahan wrote.

The tour stated in a information launch final week that the take care of SSG permits for a co-investment from Saudi Arabia’s Public Funding Fund, topic to all vital regulatory approvals.

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