The owners of Liverpool and Newcastle United are currently engaged in talks over what would be a blockbuster business deal in the world of sport.
Not only are the two organisations incredibly wealthy, but the ownership strategies of the Saudi Public Investment Fund and the Fenway Sports Group are diametrically opposed.With a focus on long-term development, FSG hopes to one day get a substantial return on its original £300 million investment—they may already receive ten times that amount.On the other hand, Newcastle’s operations are becoming closer to a self-funding model as a result of their need to increase operating income in order to comply with Premier League PSR.But PIF wants to become more well-known worldwide, and in a world without PSR, they would be prepared to absorb significant losses in order to make that happen at St. James’ Park.However, recent reports concerning conversations between the parties show that the two firms do have some similarities about their investment ambitions.
Concerning the merging of LIV-PGA, FSG and PIF are still in talks.
Football is not the only industry that the Saudis are upending.
Their desire to combine their rebellious LIV golf tour with the PGA Tour, the sport’s conventional administrator, is one of their main ongoing issues.
Due to their leadership of a group that earlier this year invested £2.4 billion in the PGA Tour, FSG has an interest in this.
The Mirror said that private negotiations between the PGA and LIV are still going on.
Recently, the two organisations got together in New York to discuss the possibility of combining the two tours. That was the most recent chapter in a business story full of flips and twists.
Again, Liverpool and Newcastle’s owners have the same targets but with wildly different motivations.
FSG are looking to diversify their sports investment portfolio and take a stake in yet another capital appreciation project, while PIF are hoping to further insert itself into Western sports culture.
What does Liverpool stand to gain from the LIV-PGA news?
Although the two clubs would not be directly impacted by a PGA-LIV merger, there may be less obvious ripple effects on governance.
The two teams’ combined interests would not be in conflict with the Premier League if the merger fails to meet certain thresholds.
Ultimately, there are numerous instances of Premier League club owners possessing similar interests across their diverse corporate portfolios.
Consider the partnership between the owners of Newcastle and Chelsea.PIF and Todd Boehly’s Clearlake Capital have partnered on several projects and made investments together.
If the two entities did merge, it could create potential opportunities for branding and sponsorship at either club.
Liverpool might want to make particular use of this given that Dynasty Equity, who are minority investors in the club, have existing links to golf through their £100m partnership with TMRW, the sports tech firm fronted by Tiger Woods and Rory McIlroy.
It could also affect the two groups’ long-term strategic goals, although any difference for Newcastle’s owners would be negligible given the vast scale of their wealth.
One other, less easily quantifiable impact of a merger could be that it establishes a closer relationship between Liverpool and Newcastle.
In an era when voting blocs and governance-level influence are becoming increasingly important within the Premier League, this could be a symbiotic arrangement for the two clubs.
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