FORT WORTH, Texas – Keeping the Texas Rangers in bankruptcy court by delaying the Aug. 4 auction will hurt the team and maybe even cost them slugger Josh Hamilton after this season, Hall of Fame pitcher Nolan Ryan told a federal bankruptcy judge Wednesday.
Ryan said he was testifying in his capacity as the team's president, although he and Pittsburgh sports attorney Chuck Greenberg have the endorsement of Major League Baseball to buy the Rangers and want to close the deal soon. The sale was delayed for months by angry creditors and is now part of a contentious bankruptcy case.
Creditors and even the court-appointed restructuring officer want the auction delayed so other bidders can line up financing. U.S. Bankruptcy Judge D. Michael Lynn is to decide Thursday whether to delay the auction after hearing more testimony.
After the team filed for Chapter 11 protection in May, it received a $21.5 million Major League Baseball loan to stay afloat during bankruptcy, in addition to $18.45 million in league loans since last year. Ryan said the team needs to exit bankruptcy to have enough money for acquisitions and expected increases in some players' salaries.
Hamilton, whose .357 batting average through Tuesday leads the major leagues, signed a one-year, $3.25 million contract with the Rangers in January. Ryan said he could command a salary of $8 million to $10 million next year. Hamilton won't be eligible for free agency this offseason, but if he and the Rangers can't strike a deal on his salary for 2011, he is eligible for salary arbitration.
"I don't know that I want to be there (if) Josh Hamilton doesn't come back next year," Ryan said.
The Rangers president said recent deals to land ace pitcher Cliff Lee and catcher Bengie Molina came "at a very expensive cost" because of the bankruptcy. Although the Rangers got more than $4 million with the players, the team had to give up more than it wanted: first baseman Justin Smoak and three minor leaguers.
He also said the team needs a new video board, which could cost from $5 million to $12 million, but must place the order by the end of August.Ryan said not signing international players and depleting its minor league teams will hurt the club down the road, although those decisions have helped the team stay in budget as it makes a run for the American League West title and first postseason berth since 1999.
Under cross-examination from a creditors' attorney, Andrew Leblanc, Ryan said the team was $5 million ahead of its budget, had larger crowds since acquiring Lee two weeks ago, and was already selling tickets for playoff games.
Ryan said he had not been aware that the team could appeal to the bankruptcy judge if Major League Baseball rejected a request to change the budget. Ryan also said some of the budget-cutting decisions came last year after team owner Tom Hicks' sports group defaulted on about $525 million in loans to lenders.
Leblanc also tried to show that the financing guarantee for the Greenberg-Ryan group, which bid about $575 million and was chosen as the buyer after bidding last year, may not expire on Aug. 12.
But Greenberg testified Wednesday that the funding expires 180 days from Feb. 12, when the first papers were executed — not later dates when the group's purchase agreement was revised. He said his investors and lenders were already frustrated in the sale's delay.
"We were anticipating (closing the deal) in early April," Greenberg said.
The Rangers wanted to sell the team to Greenberg-Ryan's group and repay creditors $75 million when it filed for bankruptcy. Since then, angry creditors have complained that the Greenberg-Ryan bid wasn't the highest and squabbles and even lawsuits have come over everything from document access to the bidding procedures.
At least four other bidders have emerged: Houston businessman Jim Crane and Dallas investor Jeff Beck, both cleared by MLB to submit bids, and two unidentified parties. There has been speculation that Dallas Mavericks owner and billionaire Mark Cuban is one of them, though he has said only that he is "interested."
0 Random Thoughts:
Post a Comment