Mavs owner Mark Cuban submits highest opening bid for Texas Rangers as auction gets under wayBy Angela K. Brown, AP
Wednesday, August 4, 2010
Cuban submits highest opening bid for Tx Rangers
FORT WORTH, Texas — A group of investors led by Dallas Mavericks owner Mark Cuban submitted the highest opening bid for the AL West-leading Texas Rangers at a rare and unusual auction in bankruptcy court Wednesday, jeopardizing the sale to Major League Baseball’s preferred buyer.
Rangers attorney Martin Sosland said Cuban’s bid was about $25 million more than the bid submitted by a group led by Rangers president Nolan Ryan and sports attorney Chuck Greenberg. That group, endorsed by MLB and the only other bidder for the team, offered about $520 million as its opening bid.
Sosland did not reveal the specific amount or provide details on the bid from a group led by Cuban and Houston businessman Jim Crane. The bid was announced six hours after the auction had been scheduled to start, an event put off as team attorneys said they were trying to determine the values of each proposal.
Thomas Lauria, an attorney for the Greenberg-Ryan group, told U.S. Bankruptcy Judge Russell Nelms the Cuban-Crane bid was not actually the highest and should not qualify. He said his group needed 12 hours to review the details “to know what we’re competing against.” He said the group may not bid if it didn’t have enough time or information, and then might file an appeal that could delay the sale.
Clifton Jessup, an attorney for the Cuban-Crane group, accused the Greenberg-Ryan group of trying to stall the auction since they could not prevent it. He urged the judge to keep the previously set auction procedures, with 20-minute breaks between the initial rounds of bidding.
Nelms gave the Greenberg-Ryan group at least an hour to decide whether to submit a higher bid. More than an hour later, Nelms told courtroom spectators that the Greenberg-Ryan group had just received the Cuban-Crane bid and would need at least another hour to review it. Nelms indicated the proceedings could last well into the night to give bidders enough time to review documents.
“We’re going to work through tonight to make that happen,” Nelms said.
After the hearing, Greenberg told The Associated Press that the Cuban-Crane bid did not meet certain qualifications when it was submitted before Tuesday night’s deadline. He said attorneys for the team and a court-appointed restructuring officer had been working with Cuban-Crane to revise the bid all morning, which he said was improper.
Cuban smiled as he left the courtroom but said he had been instructed not to comment. Ryan, the Hall of Fame pitcher whose future with the Rangers may ride on winning the auction, declined to comment.
The auction is the most dramatic development yet 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.
The Greenberg-Ryan group 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 May filing for Chapter 11 bankruptcy protection. If that group ultimately does not win, it will get a “breakup” fee of $10 million to $13 million.
Final approval of the Rangers sale rests with MLB, which has the option of choosing the second-highest bid instead.
A bid from Crane reportedly beat the Greenberg-Ryan offer in the Rangers’ original sale process last year, but MLB was leery of the businessman since his deal to buy the Houston Astros in 2008 fell through. Cuban got negative feedback from MLB when he was ready to pony up more than $1 billion for the Chicago Cubs, which wound up briefly in bankruptcy before Tribune Co. sold the team to the Ricketts family last year.
The Greenberg-Ryan group was announced as the preferred buyer in January, but the sale was stalled by angry creditors who said other bids were higher. Lenders feared they would not be repaid the $525 million in loans that owner Tom Hicks’ financially strapped ownership group defaulted on.
Hoping to push through the sale to the Greenberg-Ryan group, the Rangers filed for bankruptcy but the process has been anything but smooth or predictable.
The judge has said creditors will only get about $75 million from the team but they can go after Hicks’ other companies. Unsecured creditors are expected to be paid the full $204 million owed to them — including Alex Rodriguez, who’s owed $24.9 million in deferred compensation six years after he was traded to the New York Yankees.
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