Behind the head-spinning news this week that the PGA Tour needs to merge with a rival, the upstart Saudi-backed league known as LIV Golf, was an entity with billions to spend to make it occur: Saudi Arabia’s sovereign wealth fund.

Though the fund has lengthy been a identified presence in monetary circles, the deal that stunned the golf world has turned a Klieg gentle on a enterprise that has been described as some of the opaque on this planet.

Here’s what we all know concerning the Saudi fund.

What is the Saudi sovereign fund?

The Saudi wealth fund, often known as the Public Investment Fund, or P.I.F., is an funding pool that manages greater than $700 billion in authorities cash.

It makes use of these funds to spend money on corporations, actual property and different ventures domestically and globally to generate income, ostensibly for the good thing about the Saudi economic system.

Established in 1971 by royal decree, its headquarters are in Riyadh, Saudi Arabia, but it surely additionally has workplaces world wide. P.I.F. has grown quickly in recent times, funding formidable tourism and business undertakings it calls “giga projects.”

How does the Saudi fund rank globally?

It isn’t the most important on this planet: That could be Norway’s, which, in keeping with the Sovereign Wealth Fund Institute, at the moment manages $1.4 trillion.

Who runs the Saudi fund?

The Public Investment Fund is led by a governor, Yasir al-Rumayyan, a onetime banker and chairman of Saudi Aramco, the nation’s nationwide oil firm. He additionally hosts “Davos in the Desert,” the annual convention in Riyadh that draws hundreds of attendees.

But the true energy behind the purse strings, analysts say, is Crown Prince Mohammed bin Salman, Saudi Arabia’s de facto chief, who chairs the Public Investment Fund’s board.

Prince Mohammed has made the sovereign fund a cornerstone of his financial development plan, Vision 2030, a blueprint that goals to wean Saudi Arabia from its dependency on petrowealth and develop its economic system into know-how, well being care and different areas.

The 37-year-old crown prince has additionally set a purpose of rising the Public Investment Fund’s belongings to $3 trillion by 2030.

What are a few of the fund’s investments?

Under Prince Mohammed, the fund has invested in an array of worldwide corporations, together with Uber, the private-equity agency Blackstone, the Japanese conglomerate SoftBank and sports franchises just like the English Premier League soccer staff Newcastle United.

It can also be backing a futuristic metropolis within the Saudi desert named Neom, it introduced a brand new airline with the acquisition of 72 Boeing Dreamliners, and the fund’s web site says it’s dedicated to a “green” technique.

On Tuesday, the Public Investment Fund stated that LIV Golf was merging with the PGA Tour and DP World Tour, a European golf circuit, in hopes of making a worldwide behemoth within the sport.

What was the response?

The phrase “shock” is being tossed round loads.

For one factor, some key individuals have been disregarded of the negotiations, which have been secret. Golf followers additionally definitely didn’t see it coming.

But many in Saudi circles were ecstatic, seeing it as a countervailing narrative in opposition to a stream of detrimental press. “I’m not going to lie: This is a moment that a lot of us are relishing,” Prince Talal Al Faisal, a Saudi businessman and royal member of the family, stated in an interview.

When the LIV tour was launched in 2021, bankrolled by the sovereign wealth fund, it telegraphed a pointy break from golf’s fusty traditionalism — and immediately break up the world of males’s skilled golf.

It was seen as a breakaway league and a menace to the PGA Tour. It lured golf stars like Phil Mickelson (with a reported $200 million) to develop into frontmen. The PGA Tour scrambled to catch up by raising its payouts.

Bigger stars like Tiger Woods had harsh phrases for the brand new league and for Greg Norman, who grew to become the Western face of LIV as its commissioner. With LIV poaching a few of the most generally identified gamers from the established PGA Tour, the PGA banished them.

So the golf world greeted the brand new alliance with no small quantity of shock. Experts say if the deal goes via, it has the potential to reshape golf as we all know it.

How did the deal occur?

In hush-hush conferences presumably sweetened by promised riches.

Mr. al-Rumayyan, a detailed confidant of Prince Mohammed’s, spearheaded the talks over the previous month and a half with the PGA Tour’s commissioner, Jay Monahan.

“I recognize that people are going to call me a hypocrite,” Mr. Monahan stated after the announcement. “But circumstances do change.”

But what concerning the rancor and the controversies?

The new league, the sovereign fund, the Saudi authorities and the royal household have all been tarred in some unspecified time in the future with a patina of scandal.

LIV’s beginning prompted litigation with the PGA Tour, and the latter got here under scrutiny from Justice Department antitrust investigators, who have been analyzing whether or not the tour’s efforts to dam LIV had undermined golf’s labor market.

The Saudi funding fund has raised eyebrows by entrusting billions of {dollars} to former Trump administration officers, including an investment firm run by Jared Kushner, former President Donald J. Trump’s son-in-law; and one other run by former Treasury Secretary Steven Mnuchin.

It has invested in Russian infrastructure. And it was accused of getting a task in buying the plane that ferried the killers of the dissident Saudi author Jamal Khashoggi to Turkey, the place he was slain and his body cut into pieces, in keeping with Turkish safety officers. A U.S. intelligence report later stated the Saudi crown prince had approved the assassination.

Saudi Arabia has additionally performed a proxy function in devastating conflicts in locations like Yemen, the place a Saudi-led coalition has been combating the Iran-backed Houthi rebels since 2015.

What occurs now?

Most phrases of the deal weren’t disclosed, and it could but fall via amid scrutiny from worldwide regulators and the PGA Tour’s board, which should approve it.

But underneath the settlement introduced on Tuesday, the bitter litigation between the previous rivals is anticipated to fade like a golf ball in tall grass. The destiny of the antitrust inquiry will not be as clear.

Under the plan, Mr. al-Rumayyan would lead the board of administrators of the brand new for-profit entity. (He was beforehand a board member at Uber and SoftBank Group.)

In an interview on the Saudi Arabian podcast “Socrates” late final yr, Mr. al-Rumayyan pronounced his love for golf — “it’s a really enjoyable sport, one of the best sports” — and extolled the crown prince’s objectives for the Public Investment Fund.

“We have a full plan from here to 2030, how we first reach the trillion, then how we reach from two to three” trillion, he stated. “The crown prince is insisting on $3 trillion.”

Kristian Coates Ulrichsen, a Middle East fellow at Rice University’s Baker Institute for Public Policy, known as the deal “highly strategic” on the a part of Prince Mohammed. He stated it “reaches a segment of Middle America, also beyond the Beltway, and really engages with them to tell the story of a changing Saudi Arabia.”

The message, he added? “This isn’t the Saudi Arabia you thought you knew based on 911 or Khashoggi or Yemen.”