Shiv Kapur On LIV Golf Bankruptcy: ‘When You Grossly Overpay, You'll Never Turn A Profit'

New Delhi, Sep 9: LIV Golf's decision to seek Chapter 11 bankruptcy protection has vindicated concerns raised by former Asian Tour winner and Asian Games gold medallist Shiv Kapur, who had argued that the Saudi-backed league's initial financial model was difficult to sustain.

LIV Golf filed for Chapter 11 bankruptcy protection in New Jersey on Tuesday, reporting more than USD 500 million in debt, as the breakaway golf league attempts to restructure its business and move forward without the financial backing it had received from Saudi Arabia's Public Investment Fund (PIF).

In an exclusive interview with myKhel, Kapur had questioned LIV Golf's spending model and argued that the league needed to adopt a more sustainable structure rather than attempting to operate like a conventional global tour.

"When you grossly overpay for anything in the market, you are never going to turn a profit. So it was only a matter of time," the 44-year-old golf star said.

LIV Golf's financial difficulties intensified after PIF ended its financial support earlier this year. The league's final event was held in Indiana last month, while events in Louisiana and Michigan were cancelled.

Four vendors have already filed lawsuits over unpaid bills, while the bankruptcy filing lists USD 500 million to USD 1 billion in liabilities against estimated assets of USD 100 million to USD 500 million.

Kapur Had Proposed An IPL-Like Model

Kapur had raised concerns about LIV's business model as early as 2022, shortly after the league was launched. He argued that LIV should have followed the structure of competitions such as the Indian Premier League or Formula 1, operating within a shorter, more concentrated calendar rather than attempting to establish itself as a full-fledged golf tour.

"I wrote an article in 2022 in Golf News about LIV and how I think LIV can be sustainable," Kapur told. His argument centred on the disparity between the league's expenditure and its revenue-generating ability.

"When your bills are a billion dollars and your only receivables are only 100 or 200 million, there's going to be a mismatch," he added further.

That financial imbalance, Kapur believed, would eventually force a rethink of the competition's model.

LIV Plans A Smaller, Reworked Version

The Chapter 11 filing is now expected to provide LIV Golf with an opportunity to restructure its operations.

The league said it had reached an agreement with BC Partners as the primary source of capital for its restructuring, while PIF has agreed to provide USD 49.6 million in debtor-in-possession financing, subject to court approval.

LIV CEO Scott O'Neil said the bankruptcy process would provide the league with the structure and time needed to pursue a major transaction and begin its next phase.

O'Neil has previously outlined plans for what has been described as "LIV Golf 2.0", with players expected to become majority owners and the competition operating on a reduced schedule.

The proposed format would also see the field expand from 57 to 75 players, while introducing a 54-hole cut and Monday qualifiers.

The team concept is expected to be reorganised around nationalities, with LIV retaining some of its established markets in Australia, South Africa and Asia.

LIV has said it hopes to emerge from bankruptcy and launch the new version of the league as early as 2027.

A Far Cry From LIV's 2022 Launch

The proposed restructuring represents a significant departure from the league's original ambitions. LIV Golf launched in June 2022 with enormous financial backing and nine-figure signing bonuses designed to attract some of the biggest names from the PGA Tour.

Its spending eventually exceeded USD 5 billion before PIF announced in April that it would withdraw its financial support.

The league now faces the challenge of retaining its biggest names while building a sustainable commercial model.

Among the leading creditors listed in the bankruptcy filing are Jon Rahm, Bryson DeChambeau, Dustin Johnson and Cameron Smith. Fourteen of LIV's top 30 listed creditors are players.

Rahm's listed unsecured claim is nearly USD 7.5 million, although the filing does not represent the full amount owed to the players.

The future of Rahm and DeChambeau in particular could be crucial to the league's ability to retain its identity and commercial appeal.

'Golf Has Always Been The Ultimate Meritocracy'

Kapur's criticism of LIV was not limited to its finances. He also questioned the closed nature of the original LIV model, arguing that golf's traditional merit-based structure should remain central to any successful competition.

"Golf has always been the ultimate meritocracy where you have to earn your spot, you have to earn your right," Kapur said.

He suggested that a more open system would ultimately benefit the quality of the competition by ensuring that the best players had a route into the league based on performance.

The proposed introduction of Monday qualifiers in LIV's next version appears to move, at least partially, in that direction.

For Kapur, however, the bigger question is whether LIV can transform itself from a competition heavily dependent on external funding into a commercially sustainable sports property.