Newcastle United owners PIF under fresh scrutiny as PGA-LIV golf merger takes new twist

Newcastle United’s owners were embroiled in expensive and exposing legal proceedings until last week when LIV Golf’s legal battle with the PGA finally ended.

After announcing the shock merger at the beginning of the month, on Friday both sides filed motions to dismiss the antitrust lawsuit and countersuit in the hope of putting the dispute to bed.

However, it’s not over yet for Public Investment Fund. In fact, it could get messier.

The merger is now the subject of scrutiny from members of the US Congress, Senate and the US Department of Justice, who have confirmed they are investigating the deal.

Political opposition is growing towards PIF, threatening the future presence of the Saudis in America.

Last week, two separate Senate investigations were launched into the deal and the chair of the Senate finance committee has said he would introduce legislation to revoke Saudi Arabia’s state-backed fund’s tax-exempt status.

The lawsuit which threatened the money and resources of PIF has made way for a more rigorous investigation into the business and political dealings of the fund.

Newcastle United director Amanda Staveley was recruited into the PGA-LIV civil war to settle the dispute before it headed to court. It is believed this was to save PIF money but also to prevent questions about the fund’s relationship with the Saudi state. And despite being successful, interrogation and scrutiny is about to get worse.

Ron Myden, the Democratic chair of the finance committee, said in a letter to the PGA’s management: “The PGA Tour’s involvement with the PIF [Saudi Arabia’s public investment fund] raises significant questions about whether organisations that tie themselves to an authoritarian regime that has continually undermined the rule of law should continue to enjoy tax-exempt status in the United States.”

But how does this impact Newcastle United?

The on-goings in America continually conflate PIF with the Saudi state, in fact, this is the reason for numerous probes and investigations being launched around the merger.

Early in the golf legal proceedings, chairman of Newcastle United and LIV, Yasir Al-Rumayyan, was described as a ‘sitting minister of the Saudi government’ and PIF were called a ‘sovereign instrumentality of the Kingdom of Saudi Arabia’. He also prevented a court from seeing documents associated with LIV on the grounds it violated “the sovereignty of the foreign state.”

Al-Rumayyan is set to chair the Board of Directors for the new PGA-LIV entity.

This could be a problem for Newcastle as when the club’s takeover was approved in 2021 the Premier League were given “legally binding assurances that essentially the state will not be in charge of the club.”

Consequently, the scrutiny in the US could easily spread to the UK if anything damning is found in their investigations into PIF’s relationship with the Saudi state.

Amnesty International have been vocal in their criticism of PIF and their takeover of Newcastle and called for the Premier League to re-examine the ownership in light of Al-Rumayyan’s association.

For the coming weeks and months, as the PGA-LIV inquiries continue, Saudi Arabia’s ties to PIF will be under a microscope as members of the US government attempt to block the golf merger. If it’s bad, the fallout could wash up on Tyneside.