Texas Rangers dispute creditors’ claims that they had to take highest bid in selling team

Rangers say creditors not hurt by team’s sale

FORT WORTH, Texas — An attorney for the Texas Rangers urged a bankruptcy judge Tuesday to accept the team’s plan to pay creditors $75 million, saying the deal would not hurt any lenders and clear the way for a long-delayed sale.

Martin Sosland, a Rangers attorney, disputed some creditors’ claims that the team was required to maximize the team’s assets by accepting the highest bid.

Earlier this year, team owner Tom Hicks announced an agreement to sell the team for $575 million to a group led by Hall of Fame pitcher and team president Nolan Ryan and Pittsburgh attorney Chuck Greenberg. The deal has been stalled by concerns from creditors, who say that bid was not the highest. The Rangers have said that was the best bid.

U.S. Bankruptcy Judge D. Michael Lynn said he tended to agree with the Rangers’ argument, saying there were “considerations behind (financial) value that will play a role” in the sale.

Sosland also urged the judge to approve the team’s plan to pay $75 million to creditors, saying that’s the full amount owed and what lenders agreed to in a credit agreement.

“In the plan … the lenders are receiving everything they’re entitled to receive,” Sosland said during the hearing in federal bankruptcy court. “Your honor, $75 million is the amount.”

But creditors say they are owed repayment of the $525 million in loans that Hicks Sports Group defaulted on last year — although the bankruptcy filing was made by the team, not the ownership group. Some creditors have alleged that Hicks and the prospective ownership group made a series of last-minute agreements that capped the team’s liability for the debt at $75 million.

Attorneys for the creditors were expected to present their arguments to the judge later Tuesday.

The Rangers filed for bankruptcy last month, a rare step for any professional Major League Baseball team. Among its top 30 unsecured creditors is Alex Rodriguez, who is owed $24.9 million in deferred compensation six years after he was traded.

The judge has already approved a multimillion-dollar MLB loan to keep the Rangers afloat during bankruptcy proceedings, raising hopes that the team’s stalled $575 million sale may happen this summer.

Although Ryan and Greenberg do not know when the sale might be final, they said the Rangers plan to be active at the July 31 non-waiver trading deadline, when the team may add more expensive players in a bid for the playoffs. The team is already negotiating contracts with players taken in the amateur draft this month.