Comments on: Selig to seize Rangers; creditors to force team into bankruptcy

By: Vin Smith

Vin Smith — Mon, 10 May 2010 22:46:24 +0000

…Baseball on the field is a noble game. In the executive suite, it is a cruel sport. Everything from franchise moves (Dodgers out of Brooklyn, breaking that borough’s heart) to casting aside sports stars without paying them (when the Dodgers released the late Carl Furillo, they refused to pay him some $30,000; Furillo turned his back on baseball–I would have, too–and went to work for Otis Elevator).
Selig’s plan is likely to blow up in the face of baseball. Again and again, Bud Selig proves himself the worst commissioner in baseball history. How about his plan to vanquish the Minnesota Twins? Pure stupidity then, utter nonsense in retrospect.

By: Austin Rangers Fan

Austin Rangers Fan — Mon, 10 May 2010 16:35:30 +0000

The debt is from the Hicks Sports Group, which owns the Rangers, and is not directly tied to the Texas Rangers franchise. Note the word– “franchise”. MLB is going to take its franchise back and tell the creditors to have a nice day. The creditors needed to do a better job managing the terms of their debt. The rumors are that there is very little in the debt covenants that actually indicates what the debt is for, and recourse for the creditors if HSG were to default.
The debtors are going to make a significant haul. Rumored again, is that the sale of the Rangers will net them the amount they paid for the debt, and their portion of the sale of the Dallas Stars will be pure profit.
Just hard nosed business on both sides. I don’t see the debtors winning this round, but I do see tons of lenders lining up to loan money to baseball teams, because baseball teams have huge earning potential. Look for them to be smarter and include more precise terms in the debt agreements.

By: APBA Guy

APBA Guy — Mon, 10 May 2010 15:04:08 +0000

Lot’s of interesting speculation. Thing is, what we know is the reason that creditors do these deals is that the value of baseball franchises almost always goes up, making the creditor’s investment appear almost risk free, especially during an easy money era like the one we just passed through. If these creditors take a loss, knowing too many wall street types, they’ll:
- view the current group of creditors as stupid
- write in much tougher language in future deals
- continue to go forward with baseball deals
The track record is still too good on these transactions. This will be looked at as a “one-off”.

By: Boo Hoo Florio picked on your team - GET OVER IT

Boo Hoo Florio picked on your team - GET OVER IT — Mon, 10 May 2010 10:30:32 +0000

The reason I blame the creditors the most is that they continue to defy reasonable retribution from the sale. They need to move on. Tom Hicks indeed put them in a nasty place and deserves to make zero profit from the whole debacle, but as debt collectors know, there’s a time to cut your losses and try to recoup what they can at this point. And we have already passed the point of “no return” a long time ago. The creditors have lost this game of chicken and are failing to come to grips with it.

By: Old Gator

Old Gator — Mon, 10 May 2010 10:25:57 +0000

Heh. In which case Hicks and the creditors would have consummated their long-running game of chicken with a headon collision. I guess that Major League Baseball is death-proof, but to get the benefit of it you kinda have to be sitting where Bud Selig is.
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Even so, I find it harder to blame the creditors than Hicks. After all, Hicks wanted to stiff them for a pretty sizable portion of his debt while walking away with a load of cash from the sale, and if I’m not mistaken that is what kept them from agreeing to the deal as it was presented to them. Ryan and Greenberg are the innocent bystanders in all of this, as are the fans. And as a Feesh fan, I know all about the fan as innocent bystander.

By: Old Gator

Old Gator — Mon, 10 May 2010 10:24:51 +0000

By: Boo Hoo Florio picked on your team - GET OVER IT

Boo Hoo Florio picked on your team - GET OVER IT — Mon, 10 May 2010 10:16:19 +0000

I blame the creditors the most in this one (Tom Hicks doesn’t deserve to go unscathed for this entire ordeal however.) They keep trying to squeeze as much blood out of a stone as they can while running the risk of ending up with next to nothing. Which is what they just got with Selig seizing the team.
Holding out lots of hope for Greenberg & Ryan to end up with this franchise after all is said and done, though. They seem to be the guys who have the best interests of the team in mind.
Old Gator, to answer your second question, I believe the saying, “shit out of luck” would apply the best to Tom Hick’s situation. He’s likely headed to filing for personal bankruptcy.

By: Old Gator

Old Gator — Mon, 10 May 2010 09:58:20 +0000

Which brings up an interesting question: if the Rangers are sold off to a high bidder as the asset in a bankruptcy proceeding, do the owners still get to exercise their prerogative of approving or disapproving the buyer’s membership? Or would that prerogative be voided by the bankruptcy judge, and if so under what powers?
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Second question: would MLB or the buyer have any implicit obligation to succor Tom Hicks, or would that be up to the judge as well – or would Hicks be shit out of luck?

By: Steve C

Steve C — Mon, 10 May 2010 09:17:34 +0000

I’d love to see the Rangers head to bankruptcy court just so someone can forcibly enter Bud’s little club of owners.
Captcha: was frizzing

By: YankeesfanLen

YankeesfanLen — Mon, 10 May 2010 08:31:48 +0000

Seems to me that if banks as sources of credit dry up for fiscally-challenged teams, then new equity partners (i.e. private investors with$) would replace the needs and take a piece of ownership. Ultimately the source of the excessive spending would be censured or forced out.
But maybe that’s what just happened to Hicks.