LIV Golf bombshell: League files for bankruptcy owing up to $1bn; what happens now to its biggest stars?

LIV Golf has filed for Chapter 11 bankruptcy protection in the United States, putting the future of the breakaway tour and its biggest stars into fresh uncertainty after Saudi Arabia's Public Investment Fund withdrew its multibillion-dollar backing.The filing was made in federal court in New Jersey on Tuesday, with LIV saying the process will allow it to restructure its finances and pursue a new ownership model ahead of a planned return next year.But the court documents show the scale of the financial problems facing the tour. LIV estimates that it has between $500m and $1bn in liabilities owed to at least 1,000 creditors, while its estimated assets are between $100m and $500m.Among those creditors are several of LIV's biggest stars, with at least $45m owed to 14 current and former players included among the 30 largest unsecured claims.The filing now leaves players facing a major decision: whether to remain with a restructured version of LIV Golf or leave and attempt to recover money owed to them through the court process.Jon Rahm tops list of players owed moneyThe court documents detail the 30 largest unsecured claims against LIV Golf.Two-time major winner Jon Rahm has the largest claim among the players, with an unsecured claim of $7.5m.He is followed by Bryson DeChambeau, who is listed as being owed $5.7m, while Dustin Johnson has a claim of $5.5m.Australian Cameron Smith is listed at $4.8m and England's Tyrrell Hatton at $3.4m.The list also includes Brooks Koepka, despite the five-time major winner having already left LIV to return to the PGA Tour in January 2026. Koepka has an unsecured claim of $1.7m.In total, the 14 current and former LIV players among the 30 largest unsecured creditors are owed just over $45m.However, a source familiar with the figures told BBC Sport that the amounts listed represent money owed and not paid for the third quarter of 2026, rather than the full value of the players' contracts or the total amount they are owed.That distinction is important given the size of some of the contracts that helped LIV attract leading players away from established tours.According to reports, more than $5bn was spent by Saudi Arabia's Public Investment Fund on LIV since the breakaway tour launched in 2021, with its first season taking place in 2022.Major champions including Rahm and DeChambeau were among the players attracted by lucrative contracts and large prize funds, helping LIV establish itself as a serious rival to the PGA Tour while also creating one of the biggest divisions the sport had seen in decades. Now, that original model is coming to an end.LIV wants to return as a player-owned leagueLIV's Chapter 11 filing does not mean the tour intends to disappear.Instead, the organisation says it wants to use the bankruptcy process to reorganise and return in a different form.LIV says it has identified BC Partners, an international investment firm, as its proposed new investor following the decision by Saudi Arabia's PIF in April to withdraw its funding.LIV chief executive Scott O'Neil said the court process would provide the structure and time needed to pursue the proposed transaction and begin the next stage of the league.“This process gives us the structure and time to pursue a landmark transaction and begin the next chapter of LIV Golf,” O'Neil said.He added that the proposed new version would be built around fans, a player-first ownership model and a place within the wider global golf ecosystem.LIV's letter to fans described the court-supervised restructuring as a way to address its previous financial obligations while completing the transaction intended to support the league's next phase.The organisation said the new league would be built around a “sustainable business model”, marking a significant change from the huge spending that defined LIV's early years.Players are expected to receive equity in the new organisation, while their individual commercial rights would be returned to them. That would give players greater opportunities to earn money away from prize funds.The proposed prize money would also be reduced.LIV says its purses would be lower than those on the PGA Tour, whose prize funds have increased in part because of the competition created by LIV, but would remain higher than events on the DP World Tour.There are also plans to change the competition itself.The proposed new league would expand fields to 75 players, introduce a cut, create qualifying events and add more teams that embrace national identities.LIV also wants those teams to develop into long-term global sports businesses rather than simply remaining golf teams attached to the tour.The organisation intends to start the new majority player-owned league early in 2027, although LIV said no definitive decisions had yet been made about the 2027 schedule or individual events.LIV had already laid off the majority of its staff this month, another sign of the change from the heavily funded first version of the tour.Players are not obliged to join LIV 2.0The biggest question is now whether the players who helped make LIV a global golf story will remain part of it.BBC Sport understands that players have no obligation to sign up to LIV 2.0, even if they previously signed multi-year contracts with LIV Golf.Sources have told BBC Sport that contracts under the previous version of LIV will end as a result of the court filing, with money owed to players and other creditors dealt with through the bankruptcy process.It remains unclear, however, when those players would be free to begin discussions with other tours.LIV said it remains in advanced discussions with players, including talks about creating an ownership structure that would align their interests with the league's long-term success.Several LIV stars have reportedly been linked with possible returns to the PGA Tour and other circuits.But a return to the PGA Tour is not currently straightforward.PGA Tour chief executive and commissioner Brian Rolapp has confirmed that the tour has no current plans to reinstate its Returning Member Program, meaning players such as Rahm, DeChambeau and Smith do not currently have a direct route back.That programme was previously used by Koepka when he returned to the PGA Tour in January.As part of that agreement, Koepka forfeited his LIV player equity shares for five years, lost eligibility for the $100m FedEx Cup bonus programme and agreed to make a $5m charitable donation.His return therefore came with significant conditions, and there is currently no indication that the same pathway will be reopened for the other LIV players.Rahm and DeChambeau remain uncertain about their futuresThe uncertainty surrounding the biggest names was already visible before Tuesday's filing.At LIV's final event of the season in Indianapolis last month, O'Neil told the BBC he had “high levels of confidence” that the organisation could attract a critical mass of players to make the new league viable.DeChambeau was also positive about what could come next, saying there was “a lot of potential moving forward” and that he believed there was “something fun coming”.Rahm was more cautious.Speaking on Tuesday ahead of this week's Irish Open, the Spaniard was asked whether he knew what the coming months would bring.“Yes and no,” Rahm told BBC Sport.“It hasn't really changed from my last interview in Indianapolis.”He said there were many possible developments still ahead before adding: “Time's gonna tell.”Rahm also made clear that he was still prepared to fulfil his existing agreement with LIV.“I still have a contract with LIV 1.0 that I'm more than willing to fulfil, so like I said, time will tell,” he said.The bankruptcy filing has now changed the situation around those existing contracts, with BBC Sport reporting that the previous agreements will finish through the court process.Saudi Arabia's role is coming to an endLIV's financial difficulties follow the decision by the Public Investment Fund of Saudi Arabia to stop funding the tour.PIF had invested an estimated $5bn (£3.7bn) into LIV since its launch, helping fund the contracts, prize money and infrastructure that allowed the new league to challenge the PGA Tour.When announcing its decision to withdraw funding in April, PIF said the “substantial investment required by LIV Golf over a longer term” was no longer consistent with its strategy.The fund nevertheless said it remained committed to its wider investments in sport.Despite withdrawing its backing, PIF is still providing LIV with $49.6m (£36.6m) in debtor-in-possession financing to help fund the bankruptcy process.LIV is also seeking recognition of its US bankruptcy filing in England and Wales, which would extend the protection to its international assets and operations.The Chapter 11 process gives a US company protection from creditors while it attempts to reorganise its debts or sell parts of its business.For LIV, that process is now being used to try to preserve the league rather than simply shut it down.The original LIV model, built on enormous Saudi investment and the recruitment of many of the world's biggest players, has reached its financial end.What emerges next is intended to be smaller, more sustainable and partly controlled by the players themselves, but whether the stars who made LIV what it became will still be there is yet to be decided.Get the latest Sports News and Live updates. 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