When word arrived that Tom Hicks and Hicks Sports Group had gone into default on over a half-a-billion in loans – $525 million, to be exact – Hicks said that he was working toward selling 46 percent of his 95 percent controlling stake in the Rangers. According to Hicks at the time, the notion of selling off the controlling interest was not on the table.
That changed this past week when Hicks said, "I am selling part of the Rangers. I don’t know how big of a part. Yes, I’d be open to selling more than a minority share, but it depends on who the partners are."
I imagine that in a bat of an eye, most that follow the business side of baseball thought of the newly added president of the Rangers and Hall of Fame pitcher, Nolan Ryan as the man that could take over the controlling interest in the Rangers, and continue to move the club in a positive direction.
That was given more credence this past Friday when Ryan said that he was interested in looking into the possible purchase with long-time partner, Houston businessman Don Sanders. The two of them have partnered on the purchase of Minor League teams Round Rock and Corpus Christi.
"I think Don and I will probably take a look at it," Ryan said on Friday before the Rangers' doubleheader against the Oakland Athletics. "It's one of those things that we probably need to look at the possibilities that might be there and see if there might be a fit for us.”
Today, Fort-Worth Star-Telegram columnist Randy Galloway asks, What becomes of Nolan Ryan if Tom Hicks steps down as Texas Rangers owner?
In a key section of column, Galloway brings of the possible sale price of the Rangers:
A simple solution is for Nolan and his business partners to gather about $400 million and buy the Rangers. Simple, of course, only if you can raise the 400 mil.
Plus, other serious buyers have surfaced and will continue to surface, and at the top of the list is longtime local resident David McDavid. He is a very serious player in all this, and at the moment, the leading candidate to be the next owner of the Rangers.
Financially, I don’t think McDavid will be outbid.
The “$400 million” figure by Galloway may not have been fabricated out of thin air. Based upon the latest Forbes franchise valuations, the Rangers are listed at $405 million.
But, there may be a slight problem with that figure, not for Ryan or other possible bidders, such as McDavid, but Tom Hicks, who is reportedly looking for something in the range of $600 million.
Why the incredible $200-$250 million gap? Hicks appears to be looking to a figure that will dissolve his outstanding HSG debt and pick up a bit of profit. There's a small (actually, large) problem with that.
With the economy in its worst shape since the Great Depression, the effect has been to take a baseball bat to franchise valuations. Add in the difficulty in reaching needed credit with banks that have a stranglehold on releasing lofty sums, Hicks seems to be on the losing end of possible offering figures. After all, if the Chicago Cubs, Wrigley Field, and a 25 percent stake in Comcast SportsNet Chicago nearly didn’t break the $900 million mark in this market, how can Hicks think that the Rangers will go for $600 million?
(Tip of the hat to Adam Morris of Lone Star Baseball)
For more on the possible sale of the Rangers, along with other clubs changing hands, including the Cubs and Padres, see The Biz of Baseball's MLB Club Sales section
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Maury 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 contributor to Baseball Prospectus, and is available as a freelance writer. Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network.
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