Golfer Jon Rahm signed an expensive contract with LIV Golf

One of the best golfers in the world, number three in the world ranking Jon Rahm signed a contract with the LIV Golf tour, which could bring him about $600 million over several years. What is noteworthy in this story is not only the cost of the agreement, which makes Rahm one of the highest paid athletes in the world, but and that the Spaniard, who made his name on the PGA Tour, has moved to a rival organization. The news of Rahm’s contract casts doubt on the likelihood of the merger between LIV Golf and the PGA Tour being completed. It seems that LIV Golf, which is backed by the richest Saudi state investment fund Public Investment Fund (PIF), has decided to continue its course of “strangling” the PGA.

One of the strongest golfers in the world, number three in the ranking, Jon Rahm, will turn from a rich man into a very rich man in the coming years. He announced that starting in 2024 he will compete in tournaments held under the auspices of the LIV Golf promotion. The Spaniard is not the first top golfer to be lured to the tour, which was created only in 2021, from the “old” PGA, which has existed since 1968. For example, one of the most successful golfers in the world, Dustin Johnson, received $150 million for participating in LIV Golf tournaments. But even compared to what Johnson earned, the payments promised to Ramu are amazing.

According to ESPNthe contract is for a minimum of three years and will bring the athlete at least $300 million. Daily Mail claims that taking into account additional income, in particular the share of prize money that will be received by a team specially created for Ram (he will become its co-owner), his income will be almost $600 million. For comparison: during his career, and Ram turned professional in 2016 , he earned about $77 million. The new contract, if we focus on its maximum values, will make him the owner of the largest agreement in the history of sports. So far, that remains Lionel Messi, who received €500 million ($537 million) from Barcelona in 2017–2021.

It is noteworthy that just a few months ago, Jon Rahm categorically rejected the possibility of leaving the PGA and moving to LIV Golf.

He didn’t like the format of the competition, he wasn’t happy that there was no history behind LIV Golf. And in general, Ram said, he plays not for money, but solely for the love of golf. “For me, history and legacy are important, that’s what the PGA can give,” noted Jon Rahm. “And if they offered me, say, $400 million, how would my lifestyle change? No way! I’m already in a position where I can retire altogether.” At the event to announce his signing with LIV, Jon Rahm reiterated that he doesn’t play for the money. “But I am a man, I have a family, obligations, I must provide the best conditions for my loved ones,” he said.

Besides the value of the contract that Jon Rahm signed, there is another important aspect to his collaboration with LIV. Perhaps the signing of an agreement with the Spaniard means that LIV Golf has actually put an end to the stalled merger with the PGA. For two years, golf structures sued each other: LIV Golf accused the PGA of taking advantage of its dominant position, the PGA was responsible for trying to destroy its business by “suffocating” it (poaching players is a key aspect of such tactics). But in June, the organizations announced that they had decided not to fight anymore, but to merge into a new structure, PGA Tour Enterprises. At first there was a feeling that LIV Golf was joining the structure of the more authoritative PGA, but in reality everything turned out to be the opposite.

The US Senate became interested in this story. In June, Senate hearings were held, and it turned out that the deal was structured in such a way that real control over the combined structure would not be with the current PGA leaders, but with representatives of LIV Golf. This means that PIF, which owns the promotion, has assets exceeding $700 billion. “This is capitulation,” Senator Richard Blumenthal stated then. Around the same time as the Senate hearings, the US Department of Justice began reviewing the deal for compliance with antitrust rules. It has still not been completed, and meanwhile, the deadline set by the contracting parties for closing the deal expires on December 31. Neither LIV Golf nor the PGA say anything about its extension.

It is possible that LIV Golf decided that it would be more effective to abandon the problematic merger and return to the policy of “suffocation”. And it will be effective.

“They have no restrictions on money, time, the reason for their existence is to take our players,” Jimmy Dunn, a member of the PGA board of directors, noted at the Senate hearings.

Let us add that Saudi Arabia has been really investing heavily in sports lately. Thus, in November, the International Football Federation (FIFA) announced that the 2034 World Cup will be held in Saudi Arabia. Previously, the activity of Saudi football clubs in the transfer market caused a lot of noise. Saudi teams spent more than $800 million on the purchase of stars in the summer of 2023 alone, showing the third result in the world. PIF owns English Premier League club Newcastle United. For several years now, Saudi Arabia has been home to the world’s largest rally raid, the Dakar. In addition, the country’s authorities are ready to invest $5 billion in cricket, investing it in the development of the Indian Premier League (IPL).

Alexander Petrov