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 yesterday, beating back a nearly US$600 million offer from outspoken Dallas Mavericks owner Mark Cuban.
Officials in US federal bankruptcy court announced the winning bid to cheers in the packed courtroom, shortly before 1am local time and about 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 US$593 million offer included US$385 million in cash. The final hearing on the team’s bankruptcy plan was scheduled for later yesterday.
“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 the league, which had the option of choosing the second-highest bid instead, but it didn’t come to that.
“I’m very pleased and I look forward to Chuck Greenberg and Nolan Ryan leading the team for many years to come,” league president Bob DuPuy said outside the courtroom.
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 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 log, happily raising a champagne toast with colleagues.
The winning bid was made just after midnight. Although the Cuban-Crane group had made a US$390 million cash offer, part of a US$598 million bid, the Greenberg-Ryan bid was considered higher because of how the bids are structured; it included a US$10 million to US$13 million breakup fee that would have been paid to the Greenberg-Ryan group if it lost.
Each group’s bid included more than US$200 million of team debt — including US$24.9 million in deferred compensation owed to Alex Rodriguez six years after he was traded to the Yankees.
The Greenberg-Ryan group had the starting bid — about US$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 on 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 on Wednesday afternoon, six hours late, when Rangers attorney Martin Sosland said the bid by Cuban’s group was about US$25 million more than the bid submitted by the Greenberg-Ryan group. Later, Greenberg-Ryan offered US$2 million more than Cuban’s group, which then upped the ante by US$15 million — to about US$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 US$365 million bid that also dropped provisions worth US$12 million.
That beat the US$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.
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 a US professional sports team.
According to the team’s bankruptcy plan, creditors will only get about US$75 million from the team, no matter who ends up buying it.
However, the judge has said lenders, who are owed about US$525 million after team owner Tom Hicks’ financially strapped ownership group defaulted on loans, can go after Hicks’ other companies.
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