Many PGA Tour Sponsors Do Business in Saudi Arabia. So What Was Wrong With This One?
In November 2022, the FIFA World Cup trophy visited Saudi Arabia just ahead of the FIFA World Cup in Qatar.
Organized in partnership with the Saudi Ministry of Sports and Saudi Arabian Football Federation, the two-day trophy tour was sponsored by Coca-Cola.
Coke also sponsored the FIFA Fan Festival in Riyadh, due to its close partnership with the Saudi Ministry of Sports and the Saudi Arabian Football federation.
The fact that Coca-Cola sells its products in Saudi Arabia is not a surprise, as the beverage is in over 200 countries, but the thought that selling to the Kingdom could invalidate their relationship with the PGA Tour would be astonishing.
According to a story by Adam Schupak of Golfweek, the PGA Tour took the incredible step of deciding not to sign a title sponsorship deal with Raytheon Technologies because the company had received approval from the State Department to sell 300 MIM-104E Patriot missiles made by the company to Saudi Arabia.
Just to clarify, the MIM-104E Patriot is a defense system used to track and intercept targets, i.e. an anti-missile system.
The event Raytheon would have sponsored is the AT&T Byron Nelson, which just wrapped up outside Dallas.
It seems that AT&T was looking for an exit and the defense contractor headquartered in Arlington, Va., was more than willing to oblige—right up until the point the Tour apparently said no.
In 2021, John Deere supplied power generators to the Winter at Tantora Festival in Saudi Arabia.
That same year, FedEx Corp announced an investment of $400 million into the Saudi economy for the next 10 years.
At the time, the Memphis-based company reaffirmed the company’s commitment to the country’s non-oil economic growth, in line with Saudi Arabia’s Vision 2030 goals.
Royal Bank of Canada was part of the Aramco IPO in 2019 and BMW has at least four showrooms in the Kingdom.
Those companies have been PGA Tour sponsors for years, but what if PGA Tour commissioner Jay Monahan used the Raytheon philosophy when negotiating those deals?
So why was the Raytheon deal a no-go? The Tour declined Sports Illustrated's request for a response about what happened with Raytheon and why the deal was nixed.
What type of due diligence causes the Tour to decide that a multi-billion-dollar company is not appropriate enough to be the title sponsor of a Tour event because of its relationship with an important ally in the Middle East?
Is it because the Tour is in the middle of a lawsuit with the Private Investment Fund of Saudi Arabia?
The Tour was in bed with Allen Stanford and his Stanford Financial Group, which cost its own players millions because the Texan was running one of the largest Ponzi schemes in U.S. history.
Where was the outrage and moral indignation then?
The Tour's response by then-commissioner Tim Finchem was "we have no comment regarding the situation with Allen Stanford and certain of his companies at this time. However, we want to categorically state that the PGA Tour event in Memphis will be played as scheduled this year."
Eventually we learned that David Toms, Vijay Singh and Henrik Stenson lost millions through the Stanford scheme.
Deutsche Bank was a title sponsor of one of the playoff events outside of Boston from 2003 through 2018.
According to a Department of Justice press release from January 2021, between 2009 and 2016, Deutsche Bank and its employees violated the Foreign Corrupt Practices Act by serving as an intermediary for bribes to foreign officials and others to unfairly obtain and retain lucrative business projects overseas.
The DOJ fined the company $130 million.
It's hard to understand the logic behind where a Raytheon is shunned by the folks in Ponte Vedra, but individuals like Allen Stanford and companies like Deutsche Bank are welcomed with open arms.
This may look like a Saudi vs. PGA Tour issue, but it’s much more than that.
Spurning a large defense company that is providing legitimate products and services to an important ally is good business because ... ?
I guess that’s the point, we don’t even know what the "because" is, which makes this even more concerning.
I’m not questioning whether the commissioner or the PGA Tour Policy Board can make such a decision, I’m questioning the process and the philosophy behind it.
That's what is most concerning, because it now seems decisions are being made not on what’s best for the Tour, but on emotion while motivated by personal animus.
This cannot be the best way to run a Tour and it will only prolong the rift that has engulfed professional golf.
It’s a rift that everyone on both sides believes needs to be mended for professional golf to move forward, but it’s clear that a decision like the one regarding Raytheon only serves to protract any type of meaningful movement toward a resolution.