Raphael Stevens

More stories

  • 150 Shares199 Views

    in Business

    Overstock.com bids $21.5 million for Bed Bath & Beyond intellectual property assets

    Online retailer Overstock.com has placed a $21.5 million bid for some of Bed Bath & Beyond’s assets, including its intellectual property.
    Bed Bath & Beyond’s stores, which are currently being liquidated, are not part of the offer.
    Competing bids are due by Friday. Overstock.com’s offer will set the floor for a bankruptcy-run auction that is expected to take place on June 21.

    A “Store Closing” banner on a Bed Bath & Beyond store in Farmingdale, New York, on Friday, Jan. 6, 2023.
    Johnny Milano | Bloomberg | Getty Images

    Bed Bath & Beyond’s brand name may be the only part of the failed retailer that lives on.
    The home goods chain, which also owns Buy Buy Baby stores, received a $21.5 million offer from online retailer Overstock.com for some of its assets, including its intellectual property, according to court papers filed Tuesday.

    Overstock.com’s stalking horse bid – which will set the floor at the expected bankruptcy-run auction – also includes the business internet and mobile properties and all business data. The offer doesn’t include Bed Bath & Beyond or Buy Buy Baby’s store locations, which are running going-out-of-business sales.
    Competing bids are due by Friday. Bed Bath said in a statement it is still soliciting other offers. The auction is expected to take place June 21.
    The sale process had been extended recently as discussions had continued with prospective stalking horse bidders.
    In recent weeks discussions have centered around the assets for Buy Buy Baby, often considered the crown jewel of the Bed Bath & Beyond portfolio. The Buy Buy Baby assets in particular had attracted interested bidders.
    It’s long been thought that Bed Bath & Beyond’s stores wouldn’t attract interest, although CNBC previously reported that bidders were interested in its digital assets.

    Bed Bath & Beyond had sought chapter 11 protection in April, following months of numerous failed turnaround efforts and bankruptcy warnings.
    The retailer had 360 namesake stores and 120 Buy Buy Baby locations that were open when it filed for bankruptcy. It had previously committed to closing all of its Harmon FaceValue stores. More

  • 163 Shares199 Views

    in Business

    NHL’s Ottawa Senators reach deal with Toronto billionaire Michael Andlauer for record price

    Toronto-based billionaire Michael Andlauer has reached a deal to acquire the NHL’s Ottawa Senators, according to a person familiar with the matter.
    The deal, which is reportedly valued at nearly $1 billion, sets a record as the highest price paid for a NHL team, the person said.
    Andlauer is a minority owner in the Montreal Canadiens.

    Ottawa Senators goaltender Alex Auld (35) stops Nashville Predators’ Patric Hornqvist, right, during second-period NHL hockey action in Ottawa, Ontario, Feb. 9, 2012.
    Fred Chartrand

    The National Hockey League’s Ottawa Senators have found a new owner.
    Toronto-based billionaire Michael Andlauer has agreed to acquire the Senators, setting a record for the highest price paid for an NHL team, according to a person familiar with the matter.

    The deal is said to be valued at nearly $1 billion, Sportico earlier reported.
    Andlauer is already a minority owner of the Montreal Canadiens and had been called out in reports as an interested bidder for the Senators months ago. As part of the deal for the Senators, Andlauer will have to sell his stake in the Canadiens, The Athletic reported.
    The businessman is also the CEO of ATS Healthcare Group, which he founded in 1991.
    The team went up for sale last year after its previous owner, Eugene Melnyk, died at 62. Melnyk had owned the Senators since 2003, when he bought the team for $92 million.
    Galatioto Sports Partners led the sale on behalf of the Melnyk family. More

  • 163 Shares199 Views

    in Business

    Boeing logs more aircraft orders ahead of Paris Air Show, 787 problems persist

    Boeing handed over 50 airplanes to customers last month, up from 35 in April, though it trails rival Airbus in deliveries so far this year.
    Boeing last week said a new manufacturing flaw will slow near-term deliveries of its 787 Dreamliners.
    The Paris Air Show kicks off on Monday, when Boeing, Airbus and other aerospace manufacturers will meet with customers and potentially announce more new orders.

    Boeing 787 Dreamliners are built at the aviation company’s North Charleston, South Carolina, assembly plant on May 30, 2023. 
    Juliette Michel | AFP | Getty Images

    Boeing handed over 50 airplanes to customers last month, up from 35 in April, though it trails rival Airbus in deliveries so far this year as the Paris Air Show approaches.
    The deliveries included eight 787 Dreamliners. Boeing last week said a new manufacturing flaw — the second disclosed this year — will slow near-term deliveries of the wide-body planes, which are in high demand due to the recovery in international travel.

    Boeing has delivered 206 planes so far this year, behind the 244 that Airbus has handed over in the first five months of the year.
    Both Boeing and Airbus have announced plans to increase output of new planes to meet strong demand in the wake of the Covid pandemic.
    Arlington, Virginia-based Boeing reported gross orders of 69 planes for May, up from 34 in April. Net of 11 cancellations it sold 58 planes, most of them 737 Max jets.
    The Paris Air Show kicks off Monday, when Boeing, Airbus and other aerospace manufacturers will meet with customers and potentially announce more new orders in the first in-person iteration of the event since before the pandemic. More

  • 238 Shares199 Views

    in Business

    Saudi Arabia’s PGA merger is likely just the beginning for the kingdom when it comes to pro sports investments

    “The region is more than capable of being part of this global phenomenon, recent phenomenon of the rise in sports as part of the global economy,” Al-Falih said of the Middle East.
    The PIF is rapidly expanding into sports, hosting a Formula One Grand Prix and major boxing matches, and buying British Premier League soccer team Newcastle United.
    The two-year-long fight between the PGA Tour and Saudi Arabia’s LIV Golf ended with a stunning announcement last week the archrivals would be joining forces.

    The controversial mega merger between the PGA Tour and Saudi Arabia’s LIV Golf is just one step in the kingdom’s ambitious tourism and investment strategy — and its pursuit of big-name sports is just getting started.
    “We’re sort of a proponent to find ‘all of the above’ strategy in sport,” Saudi Investment Minister Khalid Al-Falih told CNBC’s Dan Murphy in Riyadh.

    “Any sport that has consumers globally and domestically is a sport we’re interested in as an investment opportunity, to not only create commercial returns for the investors, whether it’s the PIF or private investors, but also as an upgrade to the quality of life of Saudi Arabia, it’s part of our tourism agenda.”
    The PIF is Saudi Arabia’s Public Investment Fund, a $600 billion sovereign wealth fund controlled by Saudi Crown Prince Mohammed bin Salman. It’s being wielded as an economic tool for Vision 2030, a years-long project aiming at modernizing and diversifying the kingdom’s economy away from oil.
    News that the PGA Tour and Saudi Arabia’s LIV Golf were joining forces last week brought an end to a two-year battle between the archrivals.
    The agreement, which includes the DP World Tour — also known as the PGA European Tour — will combine the commercial businesses and rights of the PGA Tour and LIV Golf into a new, yet-to-be-named for-profit company. 
    Founded in 2021 with the goal of becoming the world’s premier professional golf tour, LIV Golf was backed by the PIF and had lured some of the biggest golf stars away from the PGA Tour with huge paychecks. That spurred lawsuits between the two entities until the decision to merge, which ended all pending litigation.

    “The region is more than capable of being part of this global phenomenon, recent phenomenon of the rise in sports as part of the global economy,” Al-Falih said of the Middle East. “And golf is part of it, is a significant part of it, and it addresses an important segment of the population who also play and follow golf.”

    Team Captain Brooks Koepka of Smash GC and caddie Ricky Elliott shake hands on the 18th green during day three of the LIV Golf Invitational – Jeddah at Royal Greens Golf & Country Club on October 16, 2022 in King Abdullah Economic City, Saudi Arabia.
    Charles Laberge | LIV Golf | Getty Images

    As part of the PGA-LIV merger, the Saudi PIF is now the exclusive investor in the new golf entity, and it has the right of first refusal on any new investment.
    The PIF is rapidly expanding into sports, hosting a Formula One Grand Prix and major boxing matches, and buying British Premier League soccer team Newcastle United.
    Saudi Arabia also lured soccer legends Cristiano Ronaldo and Karim Benzema with contracts worth hundreds of millions of dollars to play in local Saudi leagues, and it’s expected to bid to host the 2030 World Cup.
    In the past few years, the mammoth PIF fund has also bought up stakes in major blue chip companies including Amazon, Uber, Alphabet, Microsoft, Boeing, Bank of America, Disney and Meta.
    Al-Falih noted the power of sports to attract tourism, but also to offer something attractive to Saudis already in the country.
    “Sport is a significant component of global economy, consumption, media, digital content, which is now in our hands and laptops and something that as individuals, as households, as corporates, it’s part of,” he said. “And of course, as a minister of investment, I welcome it as an opportunity for us to create more — Formula E, Formula One, boxing matches, football matches.”
    “It’s part of retaining our Saudi citizens, global residents who choose Saudi Arabia as their home, to stay in Saudi Arabia and to consume this product that is of high demand,” the minister added, “and also to bring global followers of sport to the kingdom for the various activities and sports that will be taking place here.”

    Racing teams prepare on the grid of the Jeddah Corniche Circuit for the F1 Grand Prix of Saudi Arabia. A missile attack ahead of the race raised fresh doubts about how host decisions are made.
    Clive Mason | Getty Images

    Numerous human rights groups and lawmakers in other parts of the world criticize Saudi Arabia’s financial involvement in the sports world as “sportswashing,” or an effort to cleanse its image of human rights abuses.
    Saudi Arabia has long been criticized for its human rights record, which includes the imprisonment and execution of political dissidents, harsh penalties including death for members of the LGBT community, and the high-profile killing of U.S.-based journalist Jamal Khashoggi in 2018 by Saudi agents.
    CNBC has contacted the Saudi Foreign Ministry for comment.

    Portuguese football star Cristiano Ronaldo poses for a photo with the jersey after signing with Saudi Arabia’s Al-Nassr Football Club in Riyadh, Saudi Arabia on December 30, 2022.
    Al Nassr Football Club / Handout/Anadolu Agency via Getty Images

    The kingdom’s aggressive campaign to promote its image as a reformed, socially liberalizing country is a key part of the crown prince’s Vision 2030. It includes expanded freedoms for women — though many female activists still remain behind bars — and allowing previously banned things like movie theaters and concerts.
    Seventy percent of the Saudi population is under the age of 35, and the kingdom’s youth are highly digitally active and connected, creating an enormous market for televised sports and sporting events.
    “We have one of the highest consumptions per capita of many sporting activities and … electronic sports and digital games,” the Al-Falih said. “Having these activities being created in Saudi Arabia, with ownership from Saudi entities like the PIF is going to direct that demand in positive ways and it’s going to create commercial returns. I think it’s going to increase the flow of investment by Saudi investors and, like I said, that will improve the quality of life and make Saudi Arabia a more attractive place for international visitors to visit and come and live in our country.” More

  • 163 Shares129 Views

    in Finance

    Nvidia-backed platform that turns text into A.I.-generated avatars boosts valuation to $1 billion

    Artificial intelligence-based video generation platform Synthesia has raised $90 million from investors, the company told CNBC exclusively.
    The round, which values the company at $1 billion, was led by venture capital firm Accel and backed by U.S. chipmaker Nvidia.
    Synthesia will use the cash to invest in AI research, advancing on collaborations with leading colleges like Munich’s TUM and London’s UCL. 

    An animated avatar generated by the AI video platform Synthesia.

    Synthesia, a digital media platform that lets users create artificial intelligence-generated videos, has raked in $90 million from investors — including U.S. chip giant Nvidia, the company told CNBC exclusively.
    The London-based company raised the cash in a funding round led by Accel, an early investor in Facebook, Slack and Spotify. Nvidia came in as a strategic investor, putting in an undisclosed amount of money. Other investors include Kleiner Perkins, GV, FirstMark Capital and MMC. 

    related investing news

    13 hours ago

    20 hours ago

    Founded in 2017 by researchers and entrepreneurs Victor Riparbelli, Matthias Niessner, Steffen Tjerrild and Lourdes Agapito, Synthesia develops software that allows people to make their own digital avatars to deliver corporate presentations, training videos — or even compliments to colleagues in more than 120 different languages.
    Its ultimate aim is to eliminate cameras, microphones, actors, lengthy edits and other costs from the professional video production process. To do that, Synthesia has created animated avatars which look and sound like humans, but are generated by AI. The avatars are based on real-life actors who speak in front of a green screen.
    “Productivity can be improved because you are reducing the cost of producing the video to that of making a PowerPoint,” Philippe Botteri, at Accel, the lead investor in Synthesia’s Series C, told CNBC, adding that adoption of video has been proliferated by consumer platforms such as YouTube, Netflix and TikTok.
    “Video is a much better way to communicate knowledge. When we think about the potential of the company and the valuation, we think about what it can return, [and] in the case of Synthesia, we’re just scratching the surface.”
    Synthesia is a form of generative AI, similar to OpenAI’s ChatGPT. But the company says it has been working on its own proprietary generative AI for years, and that although ChatGPT may have only recently emerged into public consciousness, generative AI itself isn’t a new technology.

    Read more about tech and crypto from CNBC Pro

    Synthesia sells to enterprise clients, including Tiffany’s, IHG and Moody’s Analytics. The company doesn’t disclose its sales or revenue metrics, though it says it has “consistently driven triple digit growth,” with over 12 million videos produced on the platform to date. The number of users on Synthesia spiked 456% year over year, the company said.
    Synthesia plans to ramp up investment into its technology, with a particular focus on advancing its AI research and making Synthesia avatars capable of performing more tasks. 
    “We work with 35% of the Fortune 100 [with a focus on] product marketing, customer support, customer success — areas of the company you have a lot of text that you want to turn into video,” Riparbelli told CNBC.
    “As we’re progressing to the next phase of the next generation of Synthesia technology, it’s all about making the avatars more expressive, be able to do more things, walk around in a room, have conversations,” he added.
    Riparbelli explained Nvidia isn’t just a semiconductor manufacturer — it’s also a powerhouse of research and development talent with an army of engineers, academics and researchers who produce papers on the subject.
    “They’re not just a chip producer,” he said. “They have amazing research teams that are very much leading in terms of, how do you actually train these large models? What works, what doesn’t work?”

    Investor interest in A.I.

    Business Insider previously reported that Synthesia was in talks with investors to raise between $50 million and $75 million in new funds at a valuation of around $1 billion.
    The report didn’t include detail about Nvidia’s involvement, nor mention the total $90 million sum raised.
    Synthesia is one of many firms attracting interest from investors with AI and enterprise software that can reduce costs involved in certain business processes. Companies are looking to lower expenses everywhere they can to combat climbing inflation and prepare for a possible recession. 
    Last week, French business planning software company Pigment raised $88 million from investors including Iconiq Growth, Felix Capital, Meritech IVP and FirstMark, in part to ramp up its investment in AI.

    Generative AI has been a rare bright spot in a European tech market reeling from declining funding and a pullback in valuations. Investors have rotated out of high-growth tech firms into value sectors with more resilient income generation, such as financials, industrials, energy and consumer staples.
    Recently, a report from venture capital firm Atomico showed funding for Europe’s technology startups was on track to fall a further 39% in 2023 to $51 billion from $83 billion in 2022.
    However, AI was one area that drew more investments, Atomico said, with generative AI accounting for 35% of total investment into AI and machine learning firms last year — the highest share ever and a big jump from 5% in 2022.

    Ethical concerns about deepfakes

    There are concerns that the use of video AI tools as advanced as Synthesia could lead to deepfakes, videos which take a user’s likeness and manipulate it to make it appear as though they are saying or doing something they’re not.
    There has also been an increasing number of calls from tech leaders and academics for a global pause on AI development beyond systems like OpenAI’s GPT-4, because of fears that the technology is becoming so advanced it may pose an existential risk to humanity.
    Synthesia first attracted mainstream attention in 2019 for a deepfake video that featured a digitally animated version of celebrity soccer player David Beckham speaking about a campaign to end malaria in nine languages.
    While that was done with the consent of Beckham and for a good cause, more widespread use of deepfake technology has led to worries about the potential for misinformation.

    To address that, Synthesia says it has kept ethics in mind while developing its software. The company requires consent from the people who feature as avatars in its software, and uses a mix of humans and machine learning to target material such as profanity and hate speech.
    It is also signed up to Responsible Practices for Synthetic Media, a voluntary industrywide framework for the ethical and responsible development, creation and sharing of synthetic media.
    “There are many different discourses going on right now. There’s one about the very long-term existential sort of risk scenarios. I think they’re important to talk about as well. But I’d love to see more focus on where are we today?” Riparbelli told CNBC in an interview.
    “These technologies are already powerful. How do we deal with hallucinations? How do we deal with all of the problems that arise?” he added. “There’s definitely pitfalls. But there’s also just so much opportunity in it, I think, leveling the playing field and enabling people to do much more with less.” More

  • 150 Shares169 Views

    in Finance

    Stocks making the biggest moves premarket: Oracle, Urban Outfitters, Apple & more

    A sign is posted in front of Oracle headquarters on December 09, 2021 in Redwood Shores, California.
    Justin Sullivan | Getty Images

    Check out the companies making headlines before the bell:
    Oracle — Shares jumped more than 5% after Oracle announced a beat on top and bottom lines for the fiscal fourth quarter. Meanwhile, CEO Safra Catz said she expects adjusted earnings in the fiscal first-quarter of $1.12 to $1.16 per share. Analysts polled by Refinitiv had expected $1.14 in adjusted earnings.

    related investing news

    Urban Outfitters — Shares rose 3.4% following an upgrade to overweight from equal weight by Morgan Stanley. The firm said the retailer has a de-risked 2023 forecast and low valuation.
    Apple — Apple declined 0.7% in the premarket after UBS downgraded the stock to neutral from buy late Monday. The Wall Street firm said it sees continued pressure for iPhone demand even with support from emerging markets.
    First Horizon — Shares fell 1.2% after JPMorgan moved to a neutral rating on First Horizon. It previously had an overweight rating. The firm said the near-term outlook looks uncertain amid rising expenses.
    Zions Bancorp — Shares dipped 1.6% after the regional bank said its net interest income outlook was “decreasing.” The bank’s previous guidance described the outlook as “moderately decreasing,” according to StreetAccount. The update came in a presentation published Monday afternoon.
    Bunge — The agriculture company said it would combine with Rotterdam, Netherlands-based Viterra in a stock and cash deal. The agreement values Bunge at more than $8 billion. As part of the deal, $9.8 billion of Viterra’s debt. Bunge shares fell 1.9% in premarket trading.

    Home Depot — The retailer added 0.7% in premarket trading. The company reiterated earnings decline projections for fiscal year 2024 of 7% to 13% year over year. Home Depot is also slated to hold an investor day at 9 a.m.
    Ulta Beauty — The beauty stock rose 0.8% after Loop Capital upgraded Ulta Beauty to buy from hold. The firm said Ulta’s expansion into the luxury category “represents a multi-year comparable sales growth driver,” and its partnership with Target will “drive incremental income.”
    — CNBC’s Brian Evans, Alex Harring, Hakyung Kim and Jesse Pound contributed reporting More

  • 213 Shares179 Views

    in Finance

    Big banks are talking up generative A.I. — but the risks mean they’re not diving in headfirst

    Many terms and phrases were used by top banking and fintech executives to describe generative AI at Money 20/20 in Amsterdam this week, from “mind boggling” to an “explosion of innovation.”
    Generative AI, which generates content in response to user prompts, can be used to automate complex processes in banking.
    However, the technology is still in its early days, and many banks cautioned that it may be too risky to implement it in areas that touch consumers.

    The GPT-4 logo is seen in this photo illustration on 13 March, 2023 in Warsaw, Poland. 
    Jaap Arriens | Nurphoto | Getty Images

    AMSTERDAM, Netherlands — Major banks and fintech companies claim to be piling into generative artificial intelligence as the hype surrounding the buzzy technology shows no signs of fizzling out — but there are lingering fears about potential pitfalls and risks.
    At the Money 20/20 fintech conference in Amsterdam, Netherlands, executives at large lenders and online finance firms sang the praises of generative AI, calling it an “explosion of innovation,” and saying it will “unleash innovation in areas that we can’t even think about.”

    related investing news

    11 hours ago

    Chalapathy Neti, head of AI at global bank messaging network Swift, described the progress made with ChatGPT and GPT-4 as “mind-boggling.” He added, “This is truly a transformative moment.”
    But in the short term, banks are scrambling to figure out the use cases.
    The Netherlands’ ABN Amro is one banking giant that’s piloting the use of generative AI in its processes.
    Annerie Vreugdenhil, chief commercial officer of ABN Amro’s personal and business banking division, revealed on a panel that it is using the technology to automatically summarize conversations between bank staff and customers. It’s also using it to help its employees gather data on customers to assist with answering queries and avoid repetitive questions.
    The bank is now in the process of scaling these pilots to 200 employees and is exploring a number of new pilots to start this summer.

    In a closed-door session on the application of AI in financial services, meanwhile, two banking executives explained how they’re using the technology to improve their internal code and analyze how their clients are behaving.
    “We are experimenting at this stage and we don’t have necessarily anything client facing but we are using the [tech the] same as other companies, for example, code refactoring, comms calls, the other way around,” said Mariana Gomez de la Villa, an executive at ING Bank specializing in strategy and innovation.
    Indeed, the banks appeared unanimous in their hesitation to roll out ChatGPT-like tools to customer-facing scenarios.

    Jon Ander Beracoechea Alava, advanced analytics discipline head at Spanish bank BBVA, said that the lender had taken a “conservative approach” to AI, adding that, at this stage, generative AI is “still early” and “immature.”
    A crucial issue is that advanced AI systems require the processing of huge volumes of data — a sensitive commodity wrapped up in all kinds of rules and regulations. As such, Alava said that at this stage it was too “risky” to involve sensitive information from customers.

    Generative A.I., explained

    Generative AI is a specific form of AI that is able to produce content from scratch. The systems take inputs from the user and feed them into powerful algorithms fueled by large datasets to generate new text, images and video in a way that’s more humanlike than most AI tools already on the market.
    The technology was thrust into the spotlight following the success of OpenAI’s GPT language processing technology. ChatGPT, which uses massive language models to create human-sounding responses to questions, has ignited an arms race among some companies over what is seen as the next “paradigm shift” in tech.
    In March, Goldman Sachs’ chief information officer, Marco Argenti, told CNBC the bank is experimenting with generative AI tools internally to help its developers automatically generate and test code.
    More recently, in May, Goldman spun off the first startup from the bank’s internal incubator — an AI-powered social media company for corporate use called Louisa. The push into AI is part of a larger effort by CEO David Solomon to expedite the bank’s digital makeover.
    Morgan Stanley, meanwhile, is using it to inform its financial advisors on queries they may have. The bank has been testing an OpenAI-powered chatbot with 300 advisors so far, with a view to ultimately aid its roughly 16,000 advisors in making use of Morgan Stanley’s repository of research and data, according to Jeff McMillan, head of analytics and data at the firm’s wealth management division.

    A.I. ‘co-pilot’

    These are just some examples of how financial firms are using AI, but more as a digital helper than as a core part of their services.
    Gudmundur Kristjansson, CEO and co-founder of Icelandic regulatory technology firm Lucinity, showed CNBC how artificial intelligence can be used to assist with a key area in finance: fighting crime.
    An AI tool the company created, called Luci, aims to help compliance professionals with their investigations. In a live demonstration, Kristjansson showed himself looking into a money laundering case. The AI tool analyzed the case and described what it saw and then completed an independent review.
    In this use case, the AI acts as more of a resource — or “copilot” — to help an employee find data and flesh out a case rather than replace the role of a person looking into reports of suspicious activity.
    “Where you find money laundering is through … interconnected networks of people who are basically employed to do it. That’s why it’s so hard to find it. Banks spent this year $274 billion on prevention,” Kristjansson told CNBC in an interview.
    He said where Luci helps is by vastly reducing the amount of time spent trying to work out whether something is fraud or money laundering.

    The whole appeal of AI to the big banks and fintechs, Money 20/20 attendees said, is the potential reduction in the time and money it takes to complete tasks that can take human employees days.
    Niklas Guske, chief operating officer at Taktile, a startup that helps fintechs automate decision-making, acknowledged that the use of AI is challenging in the financial sector, given the lack of publicly available data.
    But he stressed that it could be a “crucial” tool to reduce the companies’ operational expenses and improve efficiency.
    “In many fintech applications, this is done through an increase in automation and reducing manual processes, especially in onboarding and underwriting,” he told CNBC.
    “This automation is truly enabled through access to more data sources, which empower lenders to gain new insights and identify the right customers without having to parse through dozens of PDFs for the right piece of information.”
    — CNBC’s Hugh Son contributed reporting. More

  • 138 Shares169 Views

    in Business

    Senator opens investigation into PGA Tour merger with Saudi-backed LIV Golf

    Sen. Richard Blumenthal, D-Conn., opened an inquiry into the merger of PGA Tour and Saudi-backed LIV Golf.
    The merger put a stop to pending antitrust lawsuits between the two organizations and comes amid controversy over the Saudi Arabian government’s plans for sports investment.
    The Saudi government has been accused of wide-reaching human rights violations.

    PGA Tour logo during the third round of the Travelers Championship on June 24, 2017, at TPC River Highlands in Cromwell, Connecticut.
    Fred Kfoury | Icon Sportswire | Getty Images

    WASHINGTON — A top Democratic lawmaker launched a probe on Monday into the planned merger of the PGA Tour and Saudi-backed LIV Golf.
    Sen. Richard Blumenthal, D-Conn., requested details of the agreement between the two organizations, including how the new combined entity will operate in light of Saudi Arabia’s human rights abuses, in letters to PGA Commissioner Jay Monahan and LIV Golf CEO Greg Norman.

    related investing news

    14 hours ago

    The letter from Blumenthal comes as the PGA Tour-LIV deal faces intense scrutiny and doubts about whether the merger can be completed, given the severity of prior claims in the golf leagues’ prior litigation against each other.
    The Saudi government has been accused of wide-reaching human rights violations, including the orchestration of the murder of Washington Post journalist Jamal Khashoggi in 2018.
    9/11 Families United, a group representing the families of victims of the terrorist attack, also slammed the merger due to Saudi Arabia’s involvement. Blumenthal has previously sided with victims’ families when another organization, the 9/11 Justice group, protested a LIV event at a golf course owned by former President Donald Trump.
    The June 6 merger announcement was a “sudden and drastic reversal of a position concerning LIV Golf,” wrote Blumenthal, who chairs the Senate Permanent Subcommittee on Investigations. The Tour and its commissioner had previously spoken out strongly against LIV and its role in professional golf.
    Meanwhile, the Saudi government’s Private Investment Fund, which owns LIV, had made clear plans to use investments in sports to further the Saudi government’s objectives, according to Blumenthal’s letter.

    “PGA Tour’s agreement with PIF regarding LIV Golf raises concerns about the Saudi government’s role in influencing this effort and the risks posed by a foreign government entity assuming control over a cherished American institution,” Blumenthal wrote.
    Before the agreement to merge, PGA’s rivalry with LIV included legal action between the two. The entities agreed to squash all pending litigation as part of their plan to combine commercial businesses and rights into a yet-unnamed for-profit company.
    Monahan told CNBC’s “Squawk on the Street” on Tuesday that the merger is a benefit to the game of golf despite prior “tensions.”
    The agreement will require the approval of the PGA Tour policy board, according to a memo to players from Monahan.
    “We are confident that once Congress learns more about how the PGA Tour will control this new venture, they will understand the opportunities this will create for our players, our communities and our sport, all while protecting an American golf institution,” the tour told CNBC in a statement later Monday.
    LIV Golf declined to comment on Blumenthal’s letters.
    Blumenthal asked for answers to several inquiries, including an outline of corporate structure and records of any disputes between the corporate heads and any other stakeholders, by June 26.
    – CNBC’s Jessica Golden contributed to this report. More