Ryan group wins auction for Rangers
An investment group led by Hall of Fame pitcher and Texas Rangers president Nolan Ryan won a contentious and unusual auction for the team early Thursday, beating back a nearly $600 million offer from outspoken Dallas Mavericks owner Mark Cuban.
Officials in federal bankruptcy court announced the winning bid to cheers and a standing ovation in the packed courtroom, shortly before 1 a.m. and some 10 hours after the auction began.
The group led by Ryan and Pittsburgh sports attorney Chuck Greenberg had Major League Baseball’s endorsement, and its final $593 million offer included $385 million in cash. The final hearing on the team’s bankruptcy plan was scheduled for later Thursday.
”It was an emotional roller-coaster,” a smiling Ryan said between hugs with colleagues and well-wishers in the courthouse. ”You go to court one day and it didn’t go your way, but you go back another day and it would. It’s a relief.”
Final approval of the Rangers sale rests with MLB, which had the option of choosing the second-highest bid instead. But it didn’t come to that.
Said league president Bob DuPuy outside the courtroom: ”I’m very pleased and I look forward to Chuck Greenberg and Nolan Ryan leading the team for many years to come.”
Cuban was also smiling after the auction, despite losing. His group, which included Houston businessman Jim Crane, decided against making another bid after reaching a predetermined limit. Cuban, who also looked into buying the Chicago Cubs last year, said he wanted to buy the team but had no hard feelings afterward.
”I wish them the best,” he said after shaking hands with Greenberg, Ryan and their attorneys.
A short time later, Greenberg was in a nearby parking lot, happily raising a champagne toast with colleagues.
The winning bid was made just after midnight. Although the Cuban-Crane group had made a $390 million cash offer, part of a $598 million bid, the Greenberg-Ryan bid was considered higher because of how the bids are structured; it included a $10 million to $13 million breakup fee that would have been paid to the Greenberg-Ryan group if it lost.
Each group’s bid included more than $200 million of team 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 group had the starting bid, about $520 million, 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.
The stop-and-start showdown was delayed for hours at a time Wednesday by closed-door haggling over the complicated nature of each bid. The bidding picked up and the courtroom grew more crowded as the night wore on, with attorneys and even fans crammed on the wooden benches or standing along the walls.
The auction started Wednesday afternoon, six hours late, when Rangers attorney Martin Sosland said the bid by Cuban’s group was about $25 million more than the bid submitted by the Greenberg-Ryan group. Later, 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.
After a Greenberg-Ryan attorney unsuccessfully tried to stop the auction and said the process was unfair, the group bounced back with a $365 million bid that also dropped provisions worth $12 million. That beat the $355 million cash bid from the Cuban-Crane group.
During lengthy breaks, 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 end up sitting for hours on the courtroom benches.
The snail’s pace auction, which has included tense exchanges and even yelling between the attorneys, was 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.
According to the team’s bankruptcy plan, 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.