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Home MLB News MLB Club Sales A Look Inside the Sale of the Texas Rangers

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A Look Inside the Sale of the Texas Rangers PDF Print E-mail
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MLB Club Sales
Written by Maury Brown   
Monday, 28 September 2009 12:31

RangersAdam Morris of Lone Star Ball contacted me over the weekend for a Q&A on the sale of the Texas Rangers (see Q&A with Maury Brown on the Rangers ownership situation). Here’s an excerpt:

AJM: Word is that the sale of the Rangers won't happen this winter, and will likely drag into the 2010 season.  Why should a sale take so long, given that it has been known for months now that Hicks would be selling the team?

Brown: The sales process, especially in this economy, is exceptionally difficult. The credit markets have tightened, as well. The other issue has been whether Hicks is going to sell the controlling interest. He'd like to stay on, which may or may not be of interest to potential bidders. That, and the potential bidders have to do their due diligence. The first set of "books" on the club's financials went out in January from Merrill Lynch, and since then, the club has sent out a second set of books, with William Morris Endeavor, Bank of America Merrill Lynch and Perella Weinberg as advisers. When you put it all together, any sale that can be completed within a year would be considered "fast" at this point in time, let alone the complex situation with the Rangers. If the deal gets completed by Spring Training, I'd say to any Rangers fan, be happy.


AJM: A couple of D/FW area columnists have painted the Rangers as now being a ward of the MLB state, basically in the same situation the Expos were in before they moved to Washington, with MLB having control over every move the Rangers make and dictating how much money can be spent.  In particular, it has been reported that at the end of the day MLB refused to allow the Rangers to offer first round pick Matt Purke more than slot money ($2.6 million), while the front office has indicated that they offered Purke $4 million.  How involved is MLB in the Rangers' situation right now, in terms of the Rangers making moves?  Is MLB going to be able to dictate whether the Rangers can sign free agents and how much they can offer?

Brown: I think these stories have overblown the situation. The offer for Purke was well over slot (according to Jim Callis' calculations, the recommended slot was $1.602 million). I think the decision was based upon that, and had little, if nothing to do with the financial situation that the Rangers are under. The reason I say that is the Rangers have spent over $3 million in the Latin American free agents.


AJM: What do you expect the ultimate sale price of the franchise to be, and do you have any thoughts as to who you think the favorites are among the prospective groups?

Brown: I'd look for a price of between $510-$550 million. The Rangers don't own an RSN, nor their ballpark. The lease they have, however, works in their favor. As for who will wind up winning the day, that seems very much in flux. If there is one thing that MLB is known recently for doing, it's working to cobble together ownership groups that reflect a local appeal, while having an executive structure that fits within MLB's ownership dynamic. I think that based upon that, the idea of Nolan Ryan being a part of the deal could be highly likely. From that perspective, I see Chuck Greenberg as a possibility. The rumor of Sandy Alderson having interest is intriguing, but only insofar as his ability to gain the needed capital to pull a competitive bid off.





Maury BrownMaury Brown is the Founder and President of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey. He is available for hire or freelance. Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network (select his name in the dropdown provided).

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