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Texas Rangers file Chapter 11...Stars sale not impacted? |
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Click this link if you want to read the original story.
Story
I'd retell the story, but it might send me into shock at this point. The short of it is as follows. The Texas Rangers have voluntarily taken themselves into bankruptcy to expidite the sale to Rangers Baseball Express. The process, more or less, is intended to remove the Texas Rangers from Hicks Sports Group.
What we had heard all along is that if bankruptcy had been pushed as an option the creditors would have been pushing Hicks Sports Group as an entire entity into bankruptcy. With the Rangers taking the initiative that isn't the case. The idea now is that the Rangers will be removed from Hicks Sports Group, and the Stars sale will be left to happen on it's own. The story written today, and linked above, suggests the same.
I obviously don't have a legal or financial background, but the idea that the Stars sale will be completely unimpacted by this move doesn't add up. Think about the facts:
1. Hicks Sports Group has taken on hundreds of millions of dollars of debt. The Stars are included in that.
2. The Rangers had a 75 million dollar lien placed on them which will be paid through bankruptcy. Creditors will now get 230 million
FROM HICKS SPORTS GROUP when the sale is complete instead of the rumored 280 million which had been negotiated the past few weeks.
3. Hicks Sports Group is dealing with predatory hedge funds. They will seek every penny. Hicks Sports Group's remaining assets include the Stars. Why wouldn't these same creditors seek to drain the sale of the Stars for every penny much like the Rangers process?
I might be thinking too much about this process, but I haven't seen this mentioned anywhere. I think there is legitimate reason to be concerned that a Stars sale will be a drawn out process, and that's really my whole point. Don't get your hopes up until new ownership is in place.
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