LIV Golf officially filed for bankruptcy this week, and given that I love this stuff, I have spent the last several days reading through hundreds of pages of documents.
This was a ton of work, but I am really glad that I did it. That’s because these documents don’t just tell us what LIV estimates its assets are worth. Instead, LIV filed a 128-page First Day Declaration that breaks down the league’s finances over the last few years and also the term sheet signed by its newest investment group.
So for today’s newsletter, I have included a bullet-point style list of the 25 things I found most interesting. This list includes everything from player compensation, lease agreements, and how much executives were spending on company credit cards to the ability for BC Partners to buy an expansion team for $1, the fact that the deal won’t go through unless specific sponsors and players agree to sign with LIV next season, and even the interest rate on a loan provided by Saudi Arabia.
The full breakdown is for paid subscribers only because it took me several days and countless hours to put together, but if you have been thinking about upgrading your subscription, today is the day. These filings offer an inside look at the finances of a professional sports league. The details are also super specific, making it a must-read for anyone interested in the business of sports.
Let’s get right into it.
-
LIV Golf says Saudi Arabia’s sovereign wealth fund has invested $5 billion in the business since 2021, but LIV has only $15 million in cash remaining.
-
LIV generated approximately $208 million in revenue last year: $102 million (49%) from sponsorships, $45 million (22%) from hosting fees, $33 million (16%) from ticketing and hospitality, $10 million (5%) from merchandise sales, $10 million (5%) from broadcasting rights, and $6 million (3%) from an “other” category. Bringing in as much revenue from merchandise sales as from media rights is obviously not a good sign, but it gets even worse. LIV says it has more than 20 broadcast partners covering over 200 households and a potential reach of one billion households, yet those agreements generated just $10 million last year. That’s less than $1 million in TV revenue per event.
-
LIV executives were spending roughly $250,000 per year on their corporate cards before bankruptcy. That comes out to about $3 million annualized and includes everything from flights and hotels to meals, incidentals, and supplies.
-
LIV says it had a 10,930-square-foot lease for office space in West Palm Beach. The league subleased the space to a law firm, but the deal is still a net financial loss, so LIV is asking the judge to reject both lease agreements.
Read more
