PGA Tour commissioner reportedly tells employees the reason for LIV Golf merger: 'We cannot compete with a foreign government with unlimited money'

PGA Tour Commissioner Jay Monahan explained his reasoning for the merger in a recent meeting with employees, The Wall Street Journal reported. Rob Carr/Getty Images

• PGA Tour Commissioner Jay Monahan spoke to employees about the merger with LIV Golf, WSJ reported.
• He reportedly suggested the cost of battling LIV Golf in court and on the green was unsustainable.
• He also explained how he justifies the merger given Saudi Arabia's troubling human rights record, per WSJ.

When the PGA Tour announced its surprise merger with Saudi-backed LIV Golf on Tuesday, its commissioner Joe Monahan issued a statement saying the deal would "engender a new era in global golf, for the better."  

Two days later, Monahan gathered employees of the elite golfing organization at its headquarters in Ponte Vedra Beach, Florida, with a different message, according to a new report in The Wall Street Journal.

The Journal's story said Monahan confirmed for staff what much of the sporting world already suspected: PGA Tour's legal battle with LIV was not financially sustainable.

"We cannot compete with a foreign government with unlimited money," Monahan reportedly said. "This was the time….We waited to be in the strongest possible position to get this deal in place."    

Saudi Crown Prince Mohammed bin Salman chairs a $600 billion sovereign wealth fund that backed LIV Golf. Bertrand Guay/AFP via Getty Images

Monahan also explained to employees how he justifies the merger given Saudi Arabia's human-rights record, including its treatment of women, according to the report. He mentioned his daughters by name and "took a long pause to collect himself" before explaining that "circumstances" required that he make this deal when thinking of all of the organization's employees and famed players, according to the report.

A PGA Tour spokesperson told Insider in a statement that "to characterize this agreement was made due to litigation costs and other use of reserves is an oversimplification."

"The PGA TOUR has never been a more valuable property," which the merger recognized via an investment, she added. "Additionally, this transaction will make professional golf more competitive with other professional sports and sports leagues."

PGA Tour announced the merger after a tough year of battling LIV Golf in court and on the green. LIV came on the scene in 2022 backed by the deep pockets of the Saudi Public Investment Fund, a $600 billion sovereign wealth fund chaired by Crown Prince Mohammed bin Salman, colloquially known as MBS.   

Phil Mickelson joined LIV Golf. Ben Jared/PGA TOUR via Getty Images

The merger ends mounting litigation between the two professional golfing groups, including the PGA Tour's claims that LIV wrongfully enticed its players to breach their contracts and join LIV. PGA Tour players who have joined LIV include Phil Mickelson and Bubba Watson.

Monahan, who took the helm of the PGA Tour in 2017, told employees that the organization had spent nearly $50 million in its legal fight with LIV, tapping into $100 million of its reserves to pay for other expenses, including to compete with LIV, the Journal reported.

The legal battle still had years to play out and the model was unsustainable, was Monahan's message, according to the report.