Hopefully this is nothing, but… read this tonight over at Maury Brown’s excellent bizofbaseball site on the Rangers sale.
While I expect this is just one of those legal bumps, one can never quite tell truthfully. I’ve seen so many fans around the metroplex hail what was announced over the weekend as the endgame. A lot of it reminded me of the rather boneheaded move Dubya made some years ago with his “Mission Accomplished” speech. Fans are saying “here comes the money” and doing dances, claiming Ben Sheets is coming right behind this announcement. These seem like the same kind of fans that call in to post game shows and go “when are we getting some pitching in here?” Where’s Steve Busby when you need him?
Anyway, I won’t get truly excited about this until the keys are handed over.
For the majority of Texas Rangers fans, the statement from Hicks Sports Group saying that a sales agreement between HSG and a group of investors headed by Chuck Greenberg and Nolan Ryan was a sign that the end had finally come, new owners were on the way.
But, in a case where Hicks Sports Group debt is still hanging over the heads of the Rangers, there’s a chance that the deal may not meet the muster of HSG’s biggest lender.
One of the final steps in the process includes approval from the 40 creditors that HSG is in debt to before approval from MLB. As reported by Daniel Kaplan of the SportsBusiness Journal, Monarch Alternative Capital, a hedge fund that now owns $100 million of the $525 million of debt that Tom Hicks has incurred may be a deciding factor in the sale. Monarch Alternative Capital is known as a “distressed debt buyer” or in more unflattering terms, a “predator” that looks to “buy debt at a discount from banks that hold defaulted loans and then hopes to make more by selling the assets.”
Because Monarch is in the business of extracting as much of a profit as possible in these types of deals, they could have a considerable say in the matter. As reported by the SBJ:
Monarch saying no to a deal that guarantees it a sure amount of cash could be considered an unlikely scenario, but sources are painting a picture of Monarch as being willing to go to the mat if it thinks it is not getting every penny it should.
It has been reported from multiple sources that the bid from Houston businessman, Jim Crane, was higher than the Greenberg-Ryan bid. It is unknown if Crane would be allowed back into the bidding process, should Monarch Alternative Capital not approve of the deal that the Greenberg-Ryan group has on the table.