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We're done. We're done! WE'RE DONE!
Yesterday, MLB’s ownership and executive committees unanimously approved the purchase of the Texas Rangers by a group led by Chuck Greenberg and Nolan Ryan, and today, the 30 owners have sealed the deal by voting in approving the ownership transfer today at the quarterly meetings in Minneapolis.
As put rather simply by Lone Star Ball:
MLB officially approves the sale of the Rangers to the Greenberg/Ryan group. This is a happy day for Rangers fans.
At long last, one of the wildest ownership sagas in baseball history has come to an end. Chuck Greenberg will serve as managing partner, while Nolan Ryan will continue serving as the team's president. The entire ownership group is expected to be in place by Friday afternoon, when the Rangers host the Red Sox.
"I'm not going to lie to you, it's pretty cool."
After a long, drawn-out auction process, Tom Hicks and the creditors of Hicks Sports Group have found an owner for the Texas Rangers. There's still another matter to be cleared up, however. What will happen with that other sports team owned by Hicks, the Dallas Stars?
Fans of the Stars hoped that Hicks wouldn't be forced into selling their team by the same creditors, thus avoiding the same mess that surrounded the Rangers' sale. But a new report from the Associated Press hints that the hockey club could be next on the auction block.
According to the team’s bankruptcy plan, creditors will only get about $75 million from the team, no matter who ends up buying it. But the judge has said lenders, who are owed about $525 million after team owner Tom Hicks’ financially strapped ownership group defaulted on loans, can go after Hicks’ other companies.
"Other companies" certainly would include another professional sports franchise. Our Stars blog, Defending Big D, worries what this means for their team.
Does this mean that the lenders will get involved in the sale of the Stars? Almost assuredly, but I'm also interested to see if this means they can go after Hicks-owned companies outside of HSG. I doubt it's that simple.
As it is, one sale is complete yet the lenders are only getting a fraction of what is owed to them. Around $200 million (I think) of the Rangers sale is tied up in assumed debt to the lenders (I think) and I'm assuming that the rest of this debt will be taken care of with the sale of the Stars (I think).
[Update - Here's what Dan Kaplan tweeted this morning from the courthouse: "proceeds to lenders rose from $210 mln to $340 mil bec of auction, rangers lenders attorney says"]
All we can hope is that Hicks -- and the slimy Galatioto firm -- has learned his lesson in all this, and will get the Stars sale off without nearly the amount of confusion, collusion and back-room deals that plagued the Rangers sale.
I'm praying someone swoops in and proves me wrong on all this.
There could be some uncertainty in the Stars front office in the near future.
We're finished! The Cuban-Crane group countered the $365 million bid from Greenberg-Ryan with a $390 million bid, but Greenberg-Ryan came back with a $385 million offer that had a higher present value because that offer could be closed in short order, while Cuban-Crane would require MLB approval, which could take several months. The response from Cuban-Crane?
The two sides bickered and bid for the right to purchase the team from Wednesday morning until well past midnight in Texas, until the final bid from Greenberg, submitted at about 12:25 am. CT, was not answered. Houston businessman Jim Crane, who partnered with Cuban on his bid, shook Ryan's hand and told the current Rangers president they were done bidding, ending a contentious and dramatic battle.
And so that's the end of it. Or at least, that's the end of the complicated bits of it. The sale of the Texas Rangers to the Greenberg-Ryan group should be completed within very little time, and a very deep, promising organization will find itself in strong, capable hands.
As the Texas Rangers bidding war carries on in the courtroom, the actual baseball team is locked in a tight game with the Mariners. Well, they were locked in a tight game. At around the same time the Greenberg/Ryan Group submitted their game-changing bid to own the Rangers, Michael Young hit a game-changing grand slam.
Take that as a sign if you like. Of course, they are playing the Mariners after all, so, these things happen.
And back and forth they go in the Texas Rangers bidding war…
After Mark Cuban’s group put up a bid of $355 million, including $208 million in assumed liabilities, you might have thought that would be too rich for Nolan Ryan and The Greenberg Group’s blood. But then maybe you haven’t been paying attention.
As of 12:40pm EST, Judge Russell Nelms has called for a 15-minute recess. And now we wait to see if Cuban and his partners go all-in.
As the auction for the Texas Rangers goes into the night, Nolan Ryan’s Group isn’t pleased with the way the process has gone down.
Thomas Lauria, a lawyer for a company led by Hall of Fame pitcher Nolan Ryan and attorney Chuck Greenberg, said the auction was “unfair” and asked that Judge D. Michael Lynn, who is overseeing the Rangers’ bankruptcy, rule on their complaints before bidding continued.
“The process is a mess right now,” Lauria said in court.
That still hasn’t prevented the judge from allowing bids to continue. Mark Cuban’s group has gotten theirs up to $355 million, way up from his initial $335 million bid.
Right now it’s a matter of Ryan’s group protesting the validity of Cuban’s bid, as they don’t seem willing to go higher. The process continues on.
The showdown for the right to purchase the Texas Rangers got underway Wednesday and the group headed by billionaire Dallas Mavericks owner Mark Cuban was more aggressive than The Greenberg-Ryan group, headed up by Nolan Ryan.
Court documents indicate the Greenberg-Ryan group’s starting offer was about $520 million, including more than $300 million in cash and more than $200 million of the team’s debt — including $24.9 million in deferred compensation owed to Alex Rodriguez six years after he was traded to the New York Yankees.
Rangers attorney Martin Sosland said the bid by Cuban’s group — which includes Houston businessman Jim Crane — was about $25 million more than the bid submitted by the Greenberg-Ryan group. Sosland did not reveal the total amount or what it included.
Later, Greenberg-Ryan offered $2 million more than Cuban’s group, which then upped the ante by $15 million — to about $335 million as the cash portion of the total offer.
Ultimately Major League Baseball can decide who they allow to buy the Rangers, even if it’s the second-highest bidder. Though if they do, they could face fines for rejecting the highest bidder without a credible reason.
This should get fun. Lone Star Ball will stay on top of the story as it develops.
It appeared for a little while that Fox News Corp. might place a bid on the Texas Rangers in tomorrow's auction, but Bob Nightengale informs us that this will not be the case:
News Corp. will not bid for the Rangers, according to Randy Freer, president of Fox Sports Networks.
With Fox out, previous possibility Dennis Gilbert out, and Jeff Beck seemingly out, the Rangers were left with three potential bidders: the Greenberg/Ryan group, Jim Crane, and Mark Cuban. But wait! What's this?
UPDATE #1: Added that Jim Crane will act as lead with Mark Cuban as partner for Weds.' auction.
Crane and Cuban will be working together, as has been rumored. Which means the Rangers will actually have two bidders: the Greenberg/Ryan group, and the Crane/Cuban group.
What should we expect next? Maury Brown lays it all out, so you should give that a read. Tomorrow, though, we will finally start getting some answers. Be sure to keep a watchful eye on Lone Star Ball and SB Nation Dallas/Ft. Worth as this story continues to develop.
The seemingly endless saga that has been the sale of the Texas Rangers will likely reach denouement on Wednesday when the franchise will be auctioned off. But between then and now, there is plenty of intrigue about who will end up with the team.
A group led by Nolan Ryan and and Pittsburgh attorney Chuck Greenberg has lone been considered the frontrunners to buy the team, although according to the Fort Worth Star-Telegram a new bidder may emerge: Rupert Murdoch's News Corp. According to sources, News Corp. would want to bid to protect the telecast rights Fox Sports has for Rangers games.
Creditors had previously killed a pre-packaged bankruptcy plan set up by the Nolan-Greenberg group due to the lenders' concerns that they wouldn't recoup enough out of the deal. The judge in charge of the proceedings has indicated that he would prefer for the Nolan-Greenberg group to purchase the team at a "substantially enhanced" price. Creditors have pushed for an auction, which they hope will generate a higher selling price. Still, reports that the Nolan-Greenberg group had agreed on a higher bid with the Rangers' re-structuring officer on July 30th had made other potential bidders, including Mavericks owner Mark Cuban, afraid that the auction might be a mere formality. The creditors' lawyer has said that barring a scenario where the Nolan-Greenberg group is the only bidder, the creditors will accept the results of the auction.
Bidding must begin at least $15 million above the $510 million that the Nolan-Greenberg group had previously bid.
With regards to the sale of the Texas Rangers, US bankruptcy judge Michael Lynn has ruled that the creditors have the right to vote on the pre-packaged bankruptcy plan devised by the Rangers to facilitate the sale to the Greenberg-Ryan group.
U.S. Bankruptcy Judge D. Michael Lynn said in a written ruling that creditors and team owners were adversely affected by the Rangers’ plan to pay creditors $75 million and sell the club to a group led by Hall of Fame pitcher and team president Nolan Ryan and Pittsburgh attorney Chuck Greenberg.
The ruling allows the team and two groups of creditors to vote on the plan. Because creditors have said they would vote against it, the Rangers are expected to change the plan before a vote happens.
It's that last bit that's the key. The creditors have maintained all along that they disapprove of the pre-packaged plan, meaning their vote is a certain no. As such, in order to push this sale through, the Rangers will have to modify their plan before going on to a vote. At that point, with an approved plan, the Rangers could proceed absent lender acceptance.
It's unclear exactly what this means. On the one hand, Daniel Kaplan says the creditors were "elated" with the decision, but on the other, Maury Brown quotes Texas Rangers Baseball Partners as saying:
“We are pleased that the Judge remains committed to completing the sale of the Rangers expeditiously and we are confident that necessary changes to the plan can be made to achieve that outcome.”
The Dallas Observer suggests that that changes that have to be made to the plan are relatively simple and straightforward, and that this isn't actually much of a setback. Still, what it does do is make the Rangers far less active in trade talks. Tweets Buster Olney:
1 club exec said: "The Rangers can forget about Roy Oswalt, and maybe just about any other major player."
On Tuesday, a hearing will begin that should determine whether the "pre-packaged bankruptcy" deal struck by the Greenberg-Ryan group to purchase the Texas Rangers is valid, or whether the whole sale process will be re-opened to other offers. The latter would represent a victory for the creditors, who maintain that the Rangers are not being sold to the highest bidder.
Rather than Greenberg-Ryan, the creditors would like to see the Rangers sold to Houston businessman Jim Crane, who is interested in purchasing the franchise and has reportedly offered $13-20m more than the Greenberg-Ryan group. The issue is that Tom Hicks' HSG entered into an Asset Purchase Agreement with the Greenberg-Ryan group, allowing for negotiation exclusivity.
Says the Sports Business Journal:
But it was HSG's own counsel that told MLB that prospective owner Chuck Greenberg's offer was inferior to one from Houston businessman Jim Crane. "It is unlikely we can recommend that we proceed forward with Greenberg based on where we are with their proposal and assuming we can proceed forward with Crane."
MLB Senior VP & General Counsel Tom Ostertag in an e-mail to [HSG counsel] West on Dec. 29, 2009, which was included in the bankruptcy court filings, said because Greenberg had been preliminarily chosen by HSG on Dec. 15, HSG could not entertain other offers.
Rangers blog Lone Star Ball is none too happy with everything that's going on right now:
So, basically...Hicks Sports Group entered into an exclusive agreement with Chuck Greenberg's group to sell the team to Greenberg's group in December.
As negotiations stalled, Crane re-entered the picture, seemingly in violation of the exclusivity provision in the sales agreement, and HSG's counsel then contacted the lenders to recruit them to "weigh in" so that HSG would not "be stucking negotiating" with Greenberg.
Then MLB took over the Rangers and the sales process, cutting HSG out of the loop.
There are more details that need to come out, of course...
But this reads to me like the lenders are playing hardball because HSG (which, ultimately, is Tom Hicks) encouraged the lenders to play hardball to squelch the sale to the Greenberg group.
This is the sale that will never end.
On Monday, the Rangers and the Greenberg-Ryan group announced what amounts to a prepackaged bankruptcy plan in order to facilitate the sale of the team. This announcement was made without giving prior notice to the creditors of the Hicks Sports Group. Said creditors are mad.
[With the move yesterday] creditor sources promise a major response, with one source saying, "This is now war." The creditors’ lawyers are in Texas to contest the filing, which would give the creditors around $230M, one source said. They had been seeking about $300M and had bargained up to around $280M. But the bankruptcy filing takes away the gains made at the negotiating table over the last few months.
It seems to me - and I am far from an expert - that the issue here is that the creditors don't think the Rangers are being sold for fair market value. From Bloomberg:
The Texas Rangers said there is “no viable option” for the team except a $575 million bankruptcy sale, while a group of secured lenders said the club could get a better deal.
The plan has “many conflicts” and doesn’t make the most of the club’s assets, said Dennis Dunne, a lawyer for a group of secured lenders. There is a “higher bid out there,” he told the judge.
It there's a higher bid, then the creditors, of course, would stand to get more money. This'll be an interesting one to follow, as we are not even close to being out of the woods. At the least, this could continue to drag on, and at the worst, it is within the realm of possibility that the judge sides with the creditors and determines that the Rangers must be put up for 'fair auction,' such that the alleged higher bid could emerge.
The sale of the Texas Rangers to a group led by Chuck Greenberg and Nolan Ryan, which has been pending approval by Major League Baseball and the principal lenders holding the debt on Hicks Sports Group, has been held up for a number of months, as the creditors have thus far been dissatisfied with the terms of the transaction. On Monday, however, an end to the ordeal seems to have come into view:
Texas Rangers Baseball Partners, the current owners of the Texas Rangers Baseball Club, and Rangers Baseball Express, the local investor group led by team president Nolan Ryan and Chuck Greenberg, today announced a plan to facilitate completion of the previously announced sale of the Club to the Greenberg-Ryan group.
The Rangers sale will be accomplished through a voluntary, “prepackaged,” court-supervised process under Chapter 11 of the U.S. Bankruptcy Code pursuant to a plan previously negotiated and agreed to by the current Rangers owners and the Greenberg-Ryan group.
The sale of the team and its ballpark lease, along with the separate sale of land around the stadium, has a total value of around $575 million. It's worth noting, however, that while the deal allows for "all Rangers creditors to be paid in full," it's the creditors of the Hicks Sports Group who've been making all the noise. The Rangers have been on the hook for $75 million. HSG has been on the hook for much much more, and HSG's creditors rather significantly are not part of this filing. Those creditors were not made aware of this plan prior to its announcement. As Maury Brown states:
The latest restructure plan by Texas Rangers Baseball Partners, with MLB's blessing, was not made known to the creditors in advance of the announcement today. With the plan ostensibly fulfilling the debt surrounding the Rangers sale, it is unknown what legal footing the creditors have in chellenging the move.
Craig Calcaterra believes that, in order for MLB and the Rangers to proceed with this announcement, there must be some side agreement between HSG and its creditors. The creditors have been threatening rather unpleasant legal action in the event that they aren't paid, and it seems unlikely that MLB and the Rangers would proceed with this arrangement without in some way ensuring that such action doesn't take place. However, the details on all this are light at the moment, and no one can be quite sure how it's all going to play out. If this does go down, the whole situation will be resolved in just a couple months.
As an interesting side note, the original documents include a list of the Rangers' top 30 unsecured creditors. Numbers one through six are former players awaiting deferred compensation. Number one? Alex Rodriguez, who is still owed nearly $25 million. That's $25 million that he may never be paid. Unlikely, but possible.
For more on this latest bit of news, be sure to check out Lone Star Ball.
As expected, Texas Rangers owner Tom Hicks has reached an agreement to sell the team to a group led by Pittsburgh sports attorney Chuck Greenberg which includes Hall of Fame pitcher Nolan Ryan, according to North Texas' NBC affiliate KTEN. Despite the apparent deal, it still needs to be approved by Hicks' creditors, which might not be a sure thing.
Hicks, who made his fortune as a private equity guru in the 1980s and 1990s, defaulted on more than $500 million in debts held by his sports holding company, Hicks Sports Group (HSG), back in April. Monarch Alternative Capital, a hedge fund that has snatched up about $100 of HSG's debts at distressed prices after Hicks defaulted, is now Hick's biggest lender, and could potentially block any sale. According to the Sports Business Journal, sources close to Monarch indicate that they are not pleased with the proposed deal, in part because they believe Hicks may have turned down a more lucrative deal, and also since he would apparently still own a "significant" part of the team after the sale.
So for Rangers fan over at SB Nation's Lone Star Ball, the celebrations over Hicks selling the team may be slightly premature, although it will only be a matter of time before this, or another, deal is finalized.
Tom Hicks, the owner of the Texas Rangers since 1998, is on the verge of selling the team to an investment group that includes Hall of Famer and current Rangers executive Nolan Ryan, multiple sources are reporting.
Tom Hicks is close to a deal to sell the Texas Rangers baseball team, the prospective buyers announced early Saturday.
If the sale is completed, Hicks, who also co-owns Premier League club Liverpool, would be one of the biggest investors in the group of about a dozen buyers, but he would have only a minority stake in the team.
Hicks entered into an exclusive 30-day negotiation window on Dec. 15 with Pittsburgh sports attorney Chuck Greenberg's investment group that includes Nolan Ryan, the Rangers' president the past two years.
Tonight, as the exclusive negotiating period announced on December 15 by Hicks Sports Group (HSG) expires, we are on the verge of an agreement that would provide Tom Hicks the value he seeks and the Texas Rangers the resources to become champions.
We have made extraordinary progress the last couple of weeks and have come too far to walk away now. We are fully committed and prepared to work around the clock if that’s what it takes to reach a final agreement. We are at a point where deals get done as long as both parties share a desire to cross the finish line together. There just isn't much left to resolve.
With the continued cooperation of Tom Hicks and HSG, we are certain an agreement can be finalized so we can immediately get to work on delivering the success this franchise and its fans deserve.
Check in with SB Nation's Rangers blog, Lone Star Ball, for all the updates regarding the sale of the team.
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