Recently, LIV Golf announced that the Saudi Public Investment Fund defunded their investment into the startup golf league. Ever since that update, rumors about a potential shutdown of LIV Golf continue to swirl. Tuesday, the indication arose that LIV Golf prepares to file for bankruptcy if they fail to find new investors.
The plan remains that LIV Golf wants to finish their season. However, once the season ends in August, the league intends to close down its doors if new money fails to uphold the league.
LIV Golf wants $250 million in new money. They believe that money should make the league profitable within approximately 20 months. If they only raise about $150 million, then they could bet on the strength of their team franchises and current media deal.
LIV Golf CEO Continues to Deny Potential Shutdown
GettyLIV Golf CEO Scott O’Neil continues to deny the reality of a potential shutdown.
Two weeks ago, LIV Golf CEO Scott O’Neil spoke glowingly about the names interested in buying into the league.
He said, “It was a split between private equity, family office and then your traditional like high net worth — you probably know who they are, the guys who invest in sports and sports teams. So that’s been really positive.”
However, O’Neil previously made comments that eventually became false about LIV Golf’s finances. In addition, he also claimed that the talks remain early in their duration and that nothing seems imminent.
O’Neil said, “It’s still early. We haven’t gotten to market yet. We haven’t finalized our business plan. We’re still picking and prodding. We have a good sense at this point… we know where we’re going, and we’re just going to tighten the screws.”
Eventually, clarity about the stability of LIV Golf needs an announcement. With potential stars Bryson DeChambeau and Jon Rahm potentially ready to leave the league, they risk failing to pay out their obligations to their employees.
LIV Golf Stars Quietly Prepare Their Own Exit
GettyBryson DeChambeau continues to toe the line between wanting to stay with LIV Golf and preparing to leave for the PGA Tour.
Recently, DeChambeau discussed the potential reality about his LIV Golf contract if the league shutdowns. In response to a question about being paid out the rest of his contract, he said, “Your guess is as good as mine.”
Rahm also risks losing money that the league promised him as well.
Chapter 11 of bankruptcy allows LIV Golf to cut their losses and refuse payment of their outstanding contracts. After that, they could sell their assets or let the situation die through the courts. Chapter 7 of bankruptcy potentially begins another path where the league shut downs and people invested cut their losses. Both scenarios illustrate a bad ending for LIV golfers like DeChambeau and Rahm.
Rahm recently answered some questions about LIV Golf at the PGA Championship. Despite the grim reports, his comments indicated some hope.
He said, “Out of the few talents I have in my life, fixing a business is not one of them. I might be the worst person at that. My job is to play golf, luckily. I’m decent at it, and that’s what I can focus on… When it comes to compartmentalizing, when you see it from that point of view, there’s really not much to it. I have faith in the work that they’re doing. I have faith that they’re going to come up with a good plan.”
Like HEAVY’s content? Be sure to follow us.
This article was originally published on HEAVY
The post LIV Golf Potential Shutdown Imminent After Stunning Update appeared first on HEAVY.