The bankruptcy petition was filed in the U.S. District Court for the District of New Jersey, where LIV Golf established a subsidiary earlier this summer.
Chapter 11 protection pauses the company’s obligations to creditors, providing time to restructure debt or divest portions of the business.
PIF is offering a $49.6 million (£36.6 million) debtor‑in‑possession loan to support the restructuring.
In announcing the decision to cease funding, PIF said the substantial long‑term investment required by LIV Golf is no longer aligned with its strategy.
Although it is ending funding for LIV Golf, PIF reiterated its commitment to substantial current and future investments in sports, which it considers a priority sector.
On Tuesday, LIV announced that BC Partners, an international investment firm, is its proposed new investor, as detailed in a letter to fans outlining the next phase.
“LIV Golf has entered a court‑supervised restructuring process that gives us the time and framework to address past financial obligations and finalize a transaction that will enable the league’s next phase,” the letter stated.
“In simple terms, this process is intended to create a stronger and more sustainable future for LIV Golf.”
O’Neil added that this process provides the structure and time needed to pursue a landmark transaction and start the next chapter of LIV Golf — a venture centered on fans, an innovative player‑first ownership model, and integration within the global golf ecosystem.
This further signals the end of LIV 1.0’s free‑spending era, as the letter notes the new league will be built around a sustainable business model.
Players will receive equity stakes, and individual commercial rights will be restored to them, enhancing their earning potential.
Regarding prize money, LIV Golf purses are expected to be lower than PGA Tour events — which have increased partly due to LIV’s presence — but higher than DP World Tour events.
The letter also outlined proposed changes, including expanding field sizes to 75 players, adding a cut rule, establishing qualifiers, and fielding more teams that reflect national identities, with the goal of turning teams into enduring global sports businesses.
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