After Texas Rangers Bankruptcy, Texas Rangers Auction 2010 begins for bidding. On Wednesday, August 5th 2010, the Texas Rangers baseball team will be set up for this auction. In the auction, the winning bidder will be permitted to take charge of baseball team, but he first of all requires to pass the Major League Baseball approval procedure. The approval procedure would take how much time is not clear yet.
The auction was postponed for hours because team attorneys said they were trying to determine the values of each proposal, which included different provisions. U.S. Bankruptcy Judge Russell Nelms later said the Cuban-Crane bid had been revised to more closely resemble the Greenberg-Ryan bid.
In U.S. Bankruptcy court, Nolan Ryan and his partners have succeeded. A group that includes Ryan and Pittsburgh attorney Chuck Greenberg was the top bidder in an auction on Wednesday to determine who would buy the Texas Rangers from current owner Tom Hicks.
Greenberg’s group reached an agreement on January 23 to purchase the team. The Greenberg-Ryan group’s winning bid of $593 million in U.S. Bankruptcy Court in Fort Worth topped the best offer of an alliance between Dallas Mavericks owner Mark Cuban and Houston businessman Jim Crane. Cuban and Crane submitted a final bid of $610 million but the Greenberg-Ryan offer was technically higher in present day value and they have been awarded the team.
The end came well past midnight when Crane shook hands with Ryan, congratulated him and announced his group was “done.” A crowded courtroom erupted with a standing ovation when the official announcement came.
Lynn deprived of a request from the Rangers to cancel the auction, siding with the team’s lenders. The lenders pushed for the auction to proceed as planned on Aug. 4 even though it means losing the certainty of the new Greenberg-Ryan deal.
Lynn said, “The money is the lenders’ money, and if they’re willing to roll the dice, I’m going to let them do it.”
A bankruptcy judge ruled, opening the way for Dallas Mavericks owner Mark Cuban to bid against Hall of Fame pitcher Nolan Ryan for control of the first-place baseball team. The stop-and-start showdown was delayed for hours by closed-door haggling over the complicated nature of each bid. A 45-minute break became three hours after Cuban’s group left a $335 million cash offer only a portion of the its total bid on the table.
U.S. Bankruptcy Judge Russell Nelms said he wanted to keep the auction on track, rejecting a request by attorneys for Ryan and sports attorney Chuck Greenberg for a 12-hour break to review documents. But Nelms said he anticipated a lengthy process and even obtained permission to leave on the courtroom air conditioning, which usually shuts off at 5 p.m.
Nelms said, “We’re going to work through the night.”
The Greenberg-Ryan group, endorsed by Major League Baseball, had the base bid because it was named as the team’s buyer months ago, before the deal was put in limbo by angry creditors and then by the team’s May filing for Chapter 11 bankruptcy protection. If that group eventually does not win, it will get a “breakup” fee of $10 million to $13 million.
Cuban and Houston businessman Jim Crane, who ineffectively tried to buy the team before its bankruptcy, are planning to bid, their lawyers said at today’s hearing. They may do so separately or together, said Clifton Jessup, a lawyer for Cuban.
Jessup said who pushed for Lynn to let the auction proceed, “We are prepared to bid. We have money.” Selling without an auction “is not fair and is not reasonable and smacks of collusion,” he told the judge.
According to court documents, the Greenberg-Ryan group’s starting offer was about $520 million, including more than $300 million in cash and more than $200 million of the team’s debt – including $24.9 million in deferred compensation owed to Alex Rodriguez six years after he was traded to the New York Yankees.
The Greenberg-Ryan offer, which officially began the auction, came hours after Cuban’s group was declared as the highest starting bidder.
Rangers’ legal representative, Martin Sosland said that the bid by Cuban’s group which includes Houston businessman Jim Crane – was about $25 million more than the bid submitted by the Greenberg-Ryan group. Sosland did not reveal the total amount or what it included.
Afterward Greenberg-Ryan offered $2 million more than Cuban’s group, which then upped the ante by $15 million – to about $335 million as the cash portion of the total offer.
As the night dragged on, attorneys scurried back and forth between small rooms set aside for the team, creditors and each bidder. Reporters and courtroom spectators wandered the hallways and at one point, 10 pizzas and a case of bottled water and soft drinks were delivered to Cuban’s camp.
Earlier, Ryan signed autographs for some fans, many who said they arrived after work to take in the action only to finish up sitting for hours on wooden courtroom benches.
The snail’s pace auction is the latest twist in one of the most contentious sales of an American professional sports team. The last Major League Baseball team to be auctioned off in such a way was the Baltimore Orioles in 1993.
Concluding approval of the Rangers sale rests with MLB, which has the option of choosing the second-highest bid instead. But if that happens, the league could face hefty fines or other sanctions if the judge determines it did not have a valid reason for rejecting the highest bidder.
The team’s bankruptcy plan states creditors will only get about $75 million from the team, no matter who ends up buying it. But the judge has said lenders, who are owed about $525 million after team owner Tom Hicks’ financially strapped ownership group defaulted on loans, can go after Hicks’ other companies.
Billionaire Dallas Mavericks owner Mark Cuban is upping his bid for the Texas Rangers at an unusual and contentious auction.
A confirmation hearing is scheduled for Thursday morning in front of Judge D. Michael Lynn. Major League Baseball is expected to approve the transaction by Aug. 12 when Greenberg’s financing agreements are scheduled to expire. Judge Russell Nelms oversaw the spirited auction that was stalled by numerous delays, arguments and disputes all day Wednesday and late into the night.
Ryan said, “You never know what to expect. I thought they were serious when they came over here and they proved it. I felt they came over here and tried to win the ballclub. There’s the unknown that you don’t know what to expect or anticipate. But we’re excited about the result.”
At the end of May, the Rangers filed for bankruptcy with a plan to sell to the Greenberg-Ryan group, a deal the team valued at the time at $575 million. The lenders, led by JP Morgan Chase & Co., opposed the deal and called for competitive bidding. The Rangers later agreed to an auction.
Andrew Leblanc, a lawyer for some of the lenders said, “We’re prepared to have an action next week, and we’re prepared to live with the consequences.”
Snyder did not detail the terms of the new Greenberg-Ryan bid, which was confidential. He testified that he favored scrapping the auction because the new deal provided certainty for the team. He isn’t convinced there will be competitive bidding at the auction, he said.
Tom Lauria, a lawyer for the Greenberg-Ryan group, declined to comment about today’s ruling. The case is In re Texas Rangers Baseball Partners, 10- 43400, U.S. Bankruptcy Court, Northern District of Texas (Fort Worth).