After leaving LIV Golf in the lurch, Saudi Arabia’s Public Investment Fund have delegated responsibility for finding new funding for the tour to its new-look management team.
Led by Scott O’Neil and a supporting cast encompassing investment banks, consultancy firms and players, LIV are seeking in the region of $300m in fresh capital in order to ensure the tour’s survival into 2027 and beyond. Without that money, the rebel circuit that began four years ago will go bankrupt.
A range of would-be backers have been approached, with O’Neil suggesting that he is fielding an average of three investor calls per day. Instead of sovereign wealth, it appears likely that LIV will be funded by a patchwork of private equity houses, individual millionaires and billionaires and family offices, if indeed it does secure the capital.
The tour resumes in the United Kingdom in 31 days time. The event at JCB Golf & Country Club is the first of four remaining this campaign. After the season-closer in Michigan in August, PIF says it will withdraw its financial support entirely.
The clock ticks faster when you’re living on borrowed time, and LIV know that a speedy resolution is of existential importance.
In the meantime, O’Neil needs to ensure that the tour’s players – including the likes of Bryson DeChambeau, Jon Rahm and Dustin Johnson – are paid on time, in full. There are also prize purses totalling $120m to fund, as well as operating costs.
And with some reports suggesting that it is by no foregone conclusion that PIF will stick around for the remainder of the season, LIV cannot rely on its media contracts and sponsorship deals, several of which are in fact with Saudi-backed companies, to keep the lights on. External funding is needed.
As reported by Money In Sport, a respected industry newsletter, the temporary solution appears to be loans from the Public Investment Fund, as opposed to cash injections in the form of share capital.
A 48-page agreement filed with UK business registrar Companies House shows that PIF have arranged a lending facility for LIV UK Ltd, the subsidiary to the organisation’s holding company in Jersey.
Previous paperwork shows that $66m in capital was provided in May, while the new lending facility was signed off in early June.
The terms of the facility – the amount drawn down, interest rate, maturity date and various other conditions – were not made public.
Money in Sport’s in-house estimate is that LIV is running costs of $100m per month on average.
The slow collapse of LIV Golf is taking place against the backdrop of Saudi Arabia re-evaluating its investment priorities at the very highest level. Zoom even further out and the US-Iran conflict and on-off closure of the Strait of Hormuz have caused severe economic shocks for the Kingdom.
Wildly expensive so-called ‘giga-projects’ such as the planned straight-line city Neom and Mukaab, a cuboid skyscraper in Riyadh, have been either significantly pared back or cancelled entirely. Plans for a new desert tennis centre in the under-construction Qiddiya City were unveiled last week, however.
PIF governor Yasir Al-Rumayyan meanwhile has been instructed by the Kingdom to invest more petrodollars at home rather than abroad, too. The Public Investment Fund is considering selling part of its stake in Premier League football club Newcastle United, for example, in order to pay for a new stadium. They are also running unopposed to take the FIFA World Cup to the Gulf for the second time in 12 years in 2034.
But LIV Golf is the most high-profile casualty yet, one which leaves open wounds in golf’s financial ecosystem which look nigh on impossible to cauterize.
