LIV Golf bankruptcy filing puts Saudi-backed restructuring plan under pressure

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LIV Golf bankruptcy filing

Highlights

LIV Golf files for Chapter 11 bankruptcy in New Jersey after spending $5.5bn since 2021 and ends up with just $15mn on hand.
Saudi Public Investment Fund provides a $50mn bankruptcy loan, but restructuring requires a LIV 2.0 plan within a month or risks wind-down.
Players like Jon Rahm, Bryson DeChambeau, and Cameron Smith are owed millions, with proposed settlements offering equity in LIV 2.0 amidst unsettled contract negotiations.

Chapter 11 filing tests LIV 2.0 timeline

As reported by Financial Times, LIV Golf files for Chapter 11 bankruptcy protection in federal court in Trenton, New Jersey, after spending $5.5bn in debt and equity since 2021 to build a rival golf circuit.

Court filings show the Saudi Arabia-backed league ends up with just $15mn on hand after overspending on players and failing to build the audience it had sought. The Saudi Public Investment Fund provides a $50mn bankruptcy loan to support the restructuring, but the process must produce a LIV 2.0 plan within the next month or the case moves toward a wind-down.

The proposed rescue centres on a new structure backed by $300mn raised by BC Partners, an effort that chief executive Scott O'Neil has been pursuing for months. LIV's losses, and the possible tax benefits tied to them, have also emerged as a potentially valuable part of the restructuring effort.

Player claims add pressure to restructuring

An unsecured creditors list shows that players including Jon Rahm, Bryson DeChambeau and Cameron Smith are owed at least several million dollars under contracts that LIV is seeking to terminate through Chapter 11.

A settlement offer to the golfers comes in the form of equity in LIV 2.0, whether or not they choose to play in any new competition. In court, Matthew Williams of Gibson Dunn, representing LIV, says player feedback has been enthusiastic but adds that an agreement is not yet in place and may still fail.

Court documents also show that Smith and DeChambeau have already retained personal lawyers. Judge Michael Kaplan notes that any official creditors' committee could include star players, underscoring how central contract negotiations are to the league's survival.

Our earlier coverage of the Market Financial Solutions insolvency explained how creditor pressure can reshape a court-led restructuring, including objections over potential conflicts of interest in the appointment of administrators. The piece detailed the High Court-approved replacement of a joint administrator at MFS International Limited, highlighting how oversight, governance, and creditor influence can materially affect the direction and pace of an insolvency case.

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