Feb 1, 2010, 2:45 PM EDT
That’s the viewpoint of someone associated with the group of creditors meeting with prospective Rangers’ owners Chuck Greenberg and Nolan Ryan in New York tomorrow in an attempt to iron out their differences regarding the team’s sale. It’s an ominous sign with respect to something that everyone is assuming is a done deal.
As you’ll recall, the creditors are led by a hedge fund called Monarch Alternative Capital, which bought up a bunch of Hicks Sports’ Group’s debt when it nearly defaulted on its obligations last summer. The creditors have to sign off on the tentative agreement between Hicks and Greenberg/Ryan, and from the sound of it, they don’t have a huge incentive to do so. According to the article:
The key issues, the sources said, are that while the sale has an
announced price of $570M, there is only $390M of cash changing hands,
with the difference assumed liabilities. And of that the banks would
only get $250M, sources said. Before they get paid, according to the
deal, Hicks would be paid for the real estate around the ballpark, MLB
must be paid for loans it forwarded the team, and Rangers investment
bankers, Merrill Lynch and Raine get paid too.
That’s right: Tom Hicks has helped broker a deal in which he personally gets paid before the people from whom his spendthrift ownership group had to borrow in order to make ends meet last year. And of course, Hicks himself is part of the new ownership group too. The result: an angry group of creditors is worried that they’re going to only get pennies on the dollar — “We will be better off in bankruptcy court,” a source says — and may very well tell Greenberg, Ryan and Hicks to go back to the drawing board. If that happens, you have to figure that Jim Crane and Dennis Gilbert, who were reported to have better bids than Greenberg — would come back into play.
In December I reported that there were people around Major League Baseball who were worried about this deal coming together. Those worries were brushed off at the time. Based on what we’re hearing today, I have this feeling that they’re back.
- Pitchers batting is dumb and the DH should be universal 329
- And That Happened: Sunday’s scores and highlights 66
- Alex Rodriguez hits 659th career home run, now one shy of tying Willie Mays 43
- Max Scherzer doubtful for next start due to thumb injury 4
- Protesters converge on Oriole Park at Camden Yards 149
- It sure sounds like Adam Wainwright suffered a torn Achilles tendon on Saturday night 44
- Settling the Score: Saturday’s results 33
- Report: Rangers will pay Josh Hamilton less than $7 million; deal includes opt-out after two years 99
- Pitchers batting is dumb and the DH should be universal (328)
- The early leaders in MLB’s “Franchise Four” thing have been announced (166)
- The Royals and White Sox had a benches-clearing fracas, five players ejected (159)
- Protesters converge on Oriole Park at Camden Yards (149)
- Kelvin Herrera gets a five-game suspension; Yordano Ventura fined (133)