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Texas AG Urges Court To Reject Rangers' Latest Reorganization Plan
Published July 8, 2010
|Ryan's Group Would Receive $15M "Breakup"
Fee Should It Lose Next Week's Auction
Texas Attorney General Greg Abbott yesterday weighed in on the MLB Rangers' bankruptcy case, "urging the court in Fort Worth to reject the team's current reorganization plan because of how it treats some rights of tax-collecting bodies in the state," according to Barry Shlachter of the FT. WORTH STAR-TELEGRAM. The federal trustee in the case on Tuesday "asked the court to bounce the team's bankruptcy attorneys for being too close" to Owner Tom Hicks, and earlier, major lenders "opposed the franchise's 'pre-packaged' reorganization plan aimed at taking it out of Chapter 11." Meanwhile, sources said that a "marathon mediation session to hammer out ground rules for a July 16 auction of the Rangers resumed Wednesday after grueling negotiations broke off at midnight the night before." Coming under "intense scrutiny were bidding procedures proposed by attorneys for the ballclub, which some asserted too heavily favored" Rangers President Nolan Ryan and Pittsburgh sports attorney Chuck Greenberg. The sources "declined to say if the proposal had any chance of success." Under that plan, the $304M cash portion of the Greenberg-Ryan group's May 24 deal "would serve as a minimum bid, with the next bid at least" $20M higher. Also, the Greenberg-Ryan group would collect a $15M "breakup" fee should it end up losing. The deal was part of the "prepackaged" bankruptcy plan that the team "had hoped would sail through U.S. Bankruptcy Judge Michael Lynn's court in Fort Worth." Houston businessman Jim Crane reportedly is "still interested in acquiring the team," and SportsCorp President Marc Ganis said that Crane "should not be counted out." Ganis: "There isn't this virulent opposition to him, in contrast to a number of weeks ago when the word was that Major League Baseball was for Nolan Ryan and Greenberg and no one else" (FT. WORTH STAR-TELEGRAM, 7/8).
OUTSIDE LOOKING IN: Former agent Dennis Gilbert did not attend mediation Tuesday in the bankruptcy case, suggesting he is not ready to bid for the embattled club. The team and its creditors met in federal mediation Tuesday and invited the spurned bidders of the club to attend, including Gilbert; his one time financial backer, Jeff Beck; and Crane. It is unclear if Crane and Beck attended. Gilbert's absence does not mean there will not be other bids, though it could suggest a certain reticence on behalf of MLB, a well-placed source said. MLB has pushed for Greenberg/Ryan, and Gilbert is seen as being very loyal to MLB and not wanting to cross the league's path in this regard. Gilbert confirmed he did not attend, but declined to say why. The league did not reply for comment right away. MLB President & COO Bob DuPuy last week said that when an auction occurred, MLB would retain its traditional approval rights of any potential buyer (Daniel Kaplan, SportsBusiness Journal).
RIGHT MAN FOR THE JOB: In Dallas, Evan Grant wrote Ryan's mission is to "care for the Rangers and their customers," and he "gets it." Grant: "While just about everybody else in this monetary mess has lost sight of their mission or purpose, Ryan continues to be a dignified front man for the Rangers. To a bankruptcy court, behavior, comportment, decorum and dignity may not matter. A stronger case for why Ryan -- and his partner Chuck Greenberg -- are the proper choices to run this franchise going forward could not be made" (DALLASNEWS.com, 7/7).