Completing the sale of Texas Rangers was never going to be easy, but since the sales agreement between Tom Hicks and a group led by Pittsburgh attorney Chuck Greenberg and Rangers president Nolan Ryan, sources within the group have indicated that while matters would be tight, the deal would get completed at, or close to Opening Day. With Hicks Sports Group being over a half-a-billion dollars in debt, a group of 40 creditors are looking to approve the deal before it heads to baseball’s owners for final approval.
And while the Greenberg/Ryan group has tried to paint a positive picture of the complex deal getting completed, word today is that, at least for the moment, the negotiations have reached an impasse.
The total sale price is said to hover around $570 million, but that the cash component going to the creditors is less than half that at $230 million. Daniel Kaplan of the SportsBusiness Daily paints part of the picture from Weds.” Closing Bell”:
The creditors, who must approve the sale, and MLB, which is acting as an intermediary between Hicks and his lenders, held a conference call last Friday that went very poorly, the sources said. The creditors are seeking a minimum $300M of the proceeds. “They have been at an impasse for weeks if not longer,” one source said. “Baseball has been deluding itself. No idea how long it can go.” MLB declined to comment.
A source close to the situation late Weds. added that it has been difficult sailing for some time. “When the creditors had their first meeting set with the potential ownership group, they were not happy to see that Chuck Greenberg didn’t make the trip. Since then, representatives from the league have tried to get around the issue of the creditors taking a back seat.”
The $70 million gap could be key, but according to Kaplan’s SportsBusiness Journal report from Monday, Greenberg “has arranged a loan commitment from Bank of America for $140 million to help fund the deal in the event the creditors agree to it, sources said. He plans to tap only $80 million of the funding immediately, one source said, leaving the remainder in reserve.”
Asked to comment about the Bank of America loan, the source replied, “Something has to give in order for matters to move forward.”
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