With Hicks Sports Group and its creditors still locking horns, the sale of the Texas Rangers will not be completed by the self-imposed April 1 closing date, and by most accounts, not by Opening Day on April 4. The group of 40 creditors is looking to get the most out of Tom Hicks who has defaulted on $525 million in loans. Currently, Major League Baseball is acting as an intermediary between HSG and the creditors.
While the deal will not get done by its original closing date, both the league and Chuck Greenberg, who is heading the group in line to purchase the club see the deal being closed shortly.
When asked on Saturday by Evan Grant, Commissioner Selig said he was "very hopeful" that the deal would be completed soon.
"I'm going to be very happy to get this behind us," Selig said. "Nolan [Ryan] is anxious to get it done. Everybody is anxious to get it done. I'm very, very hopeful it will get done soon, but I'm always going to use the great Yogi Berra philosophy 'it ain't over until it's over'. I'm a patient man and sometimes you have to be patient."
Reached for comment, Chuck Greenberg remains optimistic.
â€śThe process continues to move along,â€ť Greenberg said. â€śObviously, we would have we would have preferred to close the deal prior to Opening Day. But, not itâ€™s not terribly surprising given that itâ€™s a very complex transaction. And, in complex deals, you set a target date for the closing of the sale, where everybody works as hard as they can to reach that date. If you end up closing near the target date, youâ€™re doing pretty well. Now, we still think weâ€™re going to close near the target date. As long as all the right constituents are talking to one another in a constructive fashion, then we continue to move forward and Iâ€™m confident the sale will be closed in a couple of weeks after Opening Day.â€ť
If for some reason the communication were to drop and the deal begin to stall, itâ€™s possible that the league could lend their weight behind getting it to completion.
Evan Grant brought up the league having the option of taking control of the club from Hicks Sports Group in order to help expedite the deal. At that stage, there would be increased pressure on the creditors to accept the deal on the table. While having the deal get brokered without having MLB at the controls is the preferred way of going about matters, at this point the league may see that the creditors are working to get their â€śpound of fleshâ€ť out of Hicks, and that enough is enough; itâ€™s time to get the deal completed.
This is key, so please noteâ€¦.
The Greenberg/Ryan group is not purchasing HSG. They are purchasing assets owned by HSG, which include the Rangers. There is currently a $70 million lien on the club, so in essence, an offer above the $70 million would be deemed to be satisfactory if the sale moved into bankruptcy court. The sale is for considerably more (granted, there is 154 acres of land in the mix, as well, and noâ€¦ there is no lien on that land). The total sale price by Greenberg/Ryan is reported to be $570 million, but HSG is offering up a fraction of that to creditors, now reportedly $240 million, while the lenders are seeking $300 million. The gap is the main sticking point.
Of course the lendersâ€™ position is to get as much out the deal as they can, and while MLB has no love lost with Hicks these days (see How Tom Hicks Became the Most Hated Man in Baseball), as mentioned at a certain stage, MLB could take over in order to help expedite getting the sale closed. Stranger moves have happened prior. For example, the Chicago Cubs were placed momentarily into bankruptcy in order help expedite that sale with creditors. It should be noted that the Cubs deal was also a sale that took longer than the initial deadline.
Overall, itâ€™s a deal that, unless there is some unforeseen circumstance, should be resolved shortly.
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