LIV Golf scraps LIV 2.0 and winds down, with the Saudi fund as its largest creditor

LIV Golf will end the way most failed companies do: in a courtroom, with lawyers dividing what is left among the people owed money. The largest of those creditors is the Saudi sovereign fund that built the league and then chose to stop paying for it. The farewell statements skip that part. The money that created LIV now holds the biggest claim on its remains.

A lawyer for the league told a bankruptcy court in New Jersey that the plan to relaunch the circuit under new investors is off. What replaces it, in his words, is a “value-maximizing” wind-down, which means selling whatever can be sold and returning what is possible to creditors. The league’s chief executive called the whole venture “the round of a lifetime.” The court record reads less warmly.

Gibson Dunn partner Matthew Williams told Judge Michael B. Kaplan on Thursday that the debtors “were ultimately unable to bring the key parties to a fully consensual arrangement that would have supported a financially viable LIV 2.0 league.” Instead, he said, they are “toggling to a value-maximizing winddown of their business.” Front Office Sports clocked the hearing at 13 minutes. According to ESPN, Williams said the decision was not taken until that morning. LIV intends to file a Chapter 11 plan and disclosure statement for the wind-down by Monday.

The balance sheet tells the story that the statements do not. Saudi Arabia’s Public Investment Fund put more than $5 billion into LIV after its launch in 2022, pulling Jon Rahm, Bryson DeChambeau and Dustin Johnson away from the PGA Tour with guaranteed contracts worth more than $100 million and events with $30 million purses. When LIV filed for Chapter 11 on September 8, it listed between $100 million and $500 million in assets against $500 million to $1 billion in liabilities. Even at the top of that range, the assets on the books were a tenth of what the fund had spent. DP World Tour chief executive Guy Kinnings, speaking to The Scotsman, put the spending higher still: “so we are told, over $7 billion.”

The immediate trigger was BC Partners Credit. The London firm had been lined up to replace the fund as LIV’s main financier with a package worth more than $300 million, and the Financial Times reported on Wednesday that it had walked away. LIV’s own statement says its Restructuring Support Agreement was terminated because the parties could not settle “certain outstanding terms.” BC Partners said it was “disappointed that mutually acceptable terms could not be reached among the various stakeholders.”

The reporting also complicates the official explanation. Most coverage has put the collapse down to a player revolt, and the departures are real: Rahm, Sergio Garcia, Tyrrell Hatton, Louis Oosthuizen, Ian Poulter and Lee Westwood all said they would not continue, and only a handful of players, among them Brendan Steele and Cameron Tringale, publicly backed the new format. Yet ESPN, citing a source, reports that LIV had reached a critical mass of about 30 committed players with another 10 still considering, and that BC Partners pulled out when negotiations with those golfers dragged on. Williams chose similar words in court: the parties could not reach the financial and player support needed “within the required timeline.” A league that spent years buying stars with guaranteed money could not agree terms with the players it had left quickly enough to keep a lender interested.

The fund’s influence did not end when it said in April that it would not finance LIV beyond this season. As the largest creditor, the PIF controlled the bankruptcy process, Front Office Sports reports, and Williams listed it alongside BC Partners, the players and the creditors committee among the parties in the final weeks of talks. The committee that chose the wind-down says it “can and will revisit this decision” if circumstances change, and LIV says it remains open to offers from third parties. The calendar is short, though: the creditors committee meets on November 20 and Kaplan holds another hearing on November 24. The deadline that sank the rescue now governs the wind-down.

For the players, the consequences are immediate. The PGA Tour has said returning LIV players face a one-year suspension from their last event, which was in August, Sky Sports reports. That leaves the DP World Tour as the nearest option, with a mid-November deadline to take up membership for those who are eligible. Rahm, Hatton and Garcia have said that is where they will play. DeChambeau, who was fully committed to the relaunch, has one year left on his option for DP World Tour membership. Former major champions Cameron Smith and Dustin Johnson do not have that route at all.

LIV Golf’s final champion is Michael La Sasso, who won its last event in Indianapolis in August. Last week he failed to get through the second stage of European Tour qualifying school. More than $5 billion bought a league whose last winner is now trying to earn a tour card the ordinary way, and has not managed it yet.

Tags: Public Investment Fund, bankruptcies, BC Partners, Jon Rahm, LIV Golf