LIV Golf's future looks shaky, with the breakaway league's most significant crisis to date rearing its head. According to a Bloomberg report, LIV Golf is now actively laying the groundwork to file for potential bankruptcy in the United States.

A recent Sports Illustrated article highlighted the league's response, confirming they are "firmly focused on securing a transaction that positions the organization for the long term."

This strategy emerged after Saudi Arabia's Public Investment Fund announced it would end financial support after 2026.

The sovereign wealth fund is pulling the plug after pouring an estimated $5 billion into the circuit since its launch in 2021. PIF governor Yasir Al-Rumayyan has also resigned from the board.

LIV has now brought in investment banking advisor, Ducera Partners, in an attempt to collate funds. They also appointed new board members, Gene Davis and Jon Zinman, seasoned in navigating difficult situations like this.

CEO Scott O'Neil remains publicly optimistic about moving up their profitability timeline.

"We are going to create a business plan. We're going to lock arms with the players. We will go to market and raise money on the top, on a league level."

While the leadership may be displaying confidence, internal shifts suggest significant instability.

A Drastic Fallback Strategy for LIV Golf

LIV Golf is trying to raise $250 million from private equity to remain viable, as reported by Axios on Monday. The bankruptcy workaround, as reported on Wednesday, can be considered a contingency plan if the search for capital does not succeed.

In the past, there have been cases where similar precautionary filings have been used by sports organizations experiencing disruptions. For instance, the XFL had resorted to using the same measures in 2020 after losing its primary source of funding.

The United States framework is normally favored by international corporations because it offers protection against creditor actions during times of distress while looking for new capital sources.

Currently, LIV has operations across multiple jurisdictions, in the United Kingdom, the United States, and Jersey. Moving the company's headquarters to the United States would protect all of its assets from any potential seizures.

In light of the upcoming administrative turmoil, the game itself continues.

The league is currently getting ready for its next international event set to take place on May 28 in South Korea.

Do you think the lack of Saudi PIF backing will cause LIV Golf to declare bankruptcy soon? Let us know in the comments.

Written by

Abhishek Sharma

Edited by

Surjo Ray