Mediation possible for Rangers

Posted June 27, 2010, at 10:48 p.m.

           There are many numbers in baseball and fans have access to a lot of them. There is one set of numbers fans rarely see, and those are the books of the team owners.

  Those numbers are guarded like Fort Knox, only more so.

  We are now getting a glimpse into the books of the Texas Rangers because the team is in bankruptcy court.

  The current owners, primarily Tom Hicks’ corporations, are in court with creditors and would-be owners, a group headed by Chuck Greenberg that includes Nolan Ryan.

  From the court papers we learn the Rangers have not been profitable since 1998 when Hicks purchased the team.

  Hicks advanced the team corporation $100 million and when that wasn’t enough, the team borrowed from a number of lenders, including $20 million from Major League Baseball.

  The Rangers have been propped up by MLB and court records say another $21 million is available to cover team expenses through 2010.

  Those lenders, not including MLB, are fighting the sale of the team to the Greenberg group, saying there are other potential buyers out there who would pay more.

  Prior to the bankruptcy proceedings, a Houston businessman had reportedly made an offer to buy the Rangers for a reported $13 million to $20 million more than the Greenberg group’s offer of $575 million.

  Major League Baseball filed a brief with the court on behalf of the team and Greenberg’s group. It wants this public airing of the sale and the numbers ended.

  The contesting lenders want the right to approve the sale. Baseball and the Greenberg group say the lenders only have a right to be paid off in full for what the team owes, and the money is there to do that.

  The court, for convoluted legal reasons regarding loans to a Hicks’ subsidiary from the same lenders, has delayed the bankruptcy proceedings and sent the parties to mediation.

  MLB wants Greenberg and Ryan to control the Rangers. MLB ownership, one of the most closed groups in business, must approve any sale.

  The lenders want more dollars in the pool to pay for the subsidiary loans, which may not be paid off in full.

  Just follow the money.

  What MLB hates about all this is it’s public. They want the perception and so far the reality to never be questioned that franchise values continue to climb.

  Franchise value is where the real money is for every team owner and that is why they never want it discussed, especially when they are out pleading for public tax dollars to pay for this stadium or that improvement — or when it is time for a franchise sale.

  In this case Hicks himself may want to sell to a higher bidder than Greenberg’s group, but realizes baseball doesn’t want that, so he has acquiesced to the lesser dollar sale.

  Meanwhile, the trading deadline approaches at the end of July and the Rangers are in the running for a division title. Unless the bankruptcy matter is settled, the ability to make deals to help the team is in issue.

  All of which would point to a settlement in mediation. If not, the books may be opened wider.

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