Justice Department notifies PGA Tour of probe into LIV Golf merger: report

The PGA Tour’s newly announced landmark merger with Saudi Arabia's Public Investment Fund (PIF) and the DP World Tour could be facing a potential roadblock after the Justice Department informed the circuit that it would be reviewing the unexpected partnership, according to a report from The Wall Street Journal. 

Sources close to the matter told the outlet that the "​​new, collectively owned, for-profit entity," as described by the PGA Tour in its initial announcement, will be reviewed for possible antitrust concerns — the second investigation of its kind for the circuit. 

"We are confident that once all stakeholders learn more about how the PGA Tour will lead this new venture, they will understand how it benefits our players, fans and sport while protecting the American institution of golf," the tour said in a statement Thursday.

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Just shy of a year ago, the PGA Tour faced a similar probe from the Justice Department after Commissioner Jay Monahan announced that Tour members seeking to play on the LIV Golf circuit would face indefinite suspensions.

The decision prompted several players to file an antitrust lawsuit against the Tour, though some eventually abandoned the litigation. LIV Golf also joined the lawsuit, prompting the Tour to file a countersuit.

The PGA Tour announced last week, after more than a year of division, that it would be merging the PIF’s golf-related businesses, which include LIV Golf, with that of the PGA Tour and the DP World Tour into a "​​new, collectively owned, for-profit entity" and will also include a "capital investment" from the PIF. 

"The new entity (name TBD) will implement a plan to grow these combined commercial businesses, drive greater fan engagement and accelerate growth initiatives already underway. With LIV Golf in the midst of its second, groundbreaking season, the PGA TOUR, DP World Tour and PIF will work together to best feature and grow team golf going forward," the announcement read.

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The agreement also included a decision from all entities involved to end "all pending litigation." 

Reports of a potential probe into the new business venture comes less than a week after Rep. John Garamendi, D-Calif., called on the Justice Department to investigate the merger, while also proposing legislation to strip the organization of its tax-exempt status.

"The Saudi Sovereign Wealth Fund and MBS is going to get a tax break — an American tax break," Garamendi told Fox News Digital, adding that the PGA pays "no taxes, because under the tax code, it is a charity."

"I would hope that the Justice Department takes it up. I would hope the European Union does, and I would certainly call upon my congressional committees, for example, the House Judiciary Committee," he continued.

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Monahan attempted to clear things up for lawmakers in Washington on Friday in a letter in which he clarified that the agreement was not a merger, and that the PGA Tour would not be relinquishing its control. 

"The PGA Tour will at all times hold the majority of the Board seats and be in control of this new entity, regardless of the size of PIF’s investment," Monahan wrote in the letter obtained by The Associated Press. 

"At its core, the PIF is investing in the PGA Tour as it has invested in other U.S.-based companies. The PGA Tour and its tournaments will continue to operate as they do today, generating significant charitable and economic impact in the communities where they are played."

Fox News’ Brooke Singman and The Associated Press contributed to this report.