Deal reached to sell Cubs

[BCubb2003]

Cubs will be sold to Ricketts family for close to $900 million. Still needs to be approved by MLB.

http://www.chicagobreakingnews.com/2...t-breakingnews

[Chip R]

Suckers!

[Joseph]

The Ricketts must like money, but not World Series titles.

[JaxRed]

I heard they beat out the Scurvy's on this

[RichRed]

Keep the receipt!

[Chip R]

I heard they beat out the Scurvy's on this

[StillFunkyB]

We should all buy a billy goat, name it Steve, and send it to them as a welcoming gift!

[Joseph]

Darn good idea SFB

[UKFlounder]

A new twist to the story.

http://sports.espn.go.com/mlb/news/story?id=4311611

Tribune Co. has agreed to terms for the sale of the Chicago Cubs to a group led by private equity investor Marc Utay, giving the company two offers to submit to the bankruptcy court, two sources familiar with the sale process said on Tuesday.

It is the latest twist in a long-running effort by the bankrupt media company to sell the baseball team famous for its "lovable losers" image.

On Monday, a source said the Ricketts family had agreed to terms for the purchase of the team and other assets for slightly less than the $900 million it offered in January. The source called it a "handshake" agreement and not a signed document.

One of the sources reporting the Utay group's deal said the new offer is "a higher price but less cash upfront" than the Ricketts bid.

"I don't think it's completely over yet," said the source, who asked not to be identified because the sale process is continuing. "By the same token, Ricketts has a real edge here."

Tribune, which has been trying to sell the team for more than two years to reduce the company's debt burden, said no agreements are in place.

"We have not reached an agreement on terms with either party," Tribune spokesman Gary Weitman said.

Utay declined to comment and a spokesman for the Ricketts family was not immediately available to comment.

Tribune Co, which owns the Los Angeles Times and Chicago Tribune newspapers, filed for bankruptcy in December due to its heavy debt load and the weak U.S. publishing sector.

The company put the Cubs, the team's famous Wrigley Field home and a 25 percent stake in a local sports TV network on the block in April 2007, when it agreed to an $8.2 billion buyout led by real estate magnate Sam Zell.

Last month, Tribune reopened talks with private equity investors Utay and Leo Hindery in a move that some analysts saw as a way to pressure Ricketts, CEO of Chicago investment bank Incapital LLC and son of the founder of TD Ameritrade Holding Corp., into settling on terms sought by the media company.

The two sources said both offers are likely to be submitted to the bankruptcy court for review, with the Tribune recommending one.

Before any deal can be final, Major League Baseball and the bankruptcy court must approve it. The Cubs are not part of the Tribune bankruptcy, but the court must approve any deal because it is a major company asset.

"I think they will submit two bids to the court and Tribune will make a recommendation," the first source said. "This is my understanding of the situation. Who knows what Zell will ultimately do."

Sports franchises' values have been hurt by the recession and tighter credit markets. Analysts initially had expected the Cubs to draw bids topping $1 billion.

Buyers are eager to take control of the National League team, which, despite not winning a World Series title since 1908, has a huge fan base helped by its national exposure on cable television.

[oneupper]

Good News for Tribune Co bondholders.

[redsmetz]

Heard this on NPR this morning, here's a report from Bloomsberg indicating the Cubs may file for bankruptcy as part of their sale:

The Chicago Cubs may become the first Major League Baseball team in 39 years to file for bankruptcy as Tribune Co. seeks to sell the franchise after months of negotiations.

Tribune sought Chapter 11 protection in December. It is contemplating a separate filing for the Cubs to expedite the team’s estimated $900 million sale to interested bidders, including Incapital LLC Chairman Tom Ricketts, according to four people familiar with the plan.

A brief Cubs bankruptcy would be a legal maneuver to clear the team from any future liability in the Tribune bankruptcy, according to two of the people familiar with the matter. Sam Zell, chief executive officer of Chicago-based Tribune, pledged the company’s interest in the Cubs as collateral when he negotiated the deal to take the publisher private in 2007, according to one of those people.

“You take it in the front door, and it’s just like you’re getting radiation,” said Michael J. Cramer, a former president of the Texas Rangers who teaches sports business at New York University. “It comes out the other door about a half minute later. It’s clean.”

Richard Levin, a spokesman for Major League Baseball, and Ricketts through a spokesman, Dennis Culloton, both declined to comment. “The company doesn’t comment on any potential transactions,” Gary Weitman, a Tribune spokesman, said in an interview yesterday.

The Cubs weren’t a part of Tribune’s bankruptcy filing. The people familiar with the matter said it remained possible the sale would close without the team filing as well.

Millions of Fans

While Denise Brown, a Tribune spokeswoman, said the company doesn’t disclose the finances of individual units, the club is one of the most popular franchises in baseball. It drew more than 3 million spectators to 95-year-old Wrigley Field in each of the past five seasons.

Sale of the Cubs is subject to approval by Major League Baseball. The move could guarantee that the Cubs are sold free and clear of Tribune’s creditors, Cramer said.

“This would make sense for Major League Baseball,” he said. “They would like to see that asset be stand-alone, very clean, not tied up in other issues.”

People familiar with the negotiations said a Cubs bankruptcy filing would be designed to allow for the fast disposition of the team’s assets. It could be accompanied by a motion to sell the team with an agreed-upon bidder. The entire process could take as little as 20 days, said Gregory A. Cross, the attorney who heads the bankruptcy practice at Washington- based Venable LLP and isn’t involved.

Coyote Ugly

Not all bankruptcy sales move as fast. The National Hockey League’s Phoenix Coyotes filed a Chapter 11 case in May with plans for a quick transaction, only to have it descend into a legal fight about whether the team may be sold and moved without the league’s consent.

While no buyer is likely to try to move the Cubs out of Chicago, a speedy sale would be derailed if a Cubs auction ended with a winner that baseball’s other owners refused to accept, Thomas J. Salerno, the Coyotes’ bankruptcy attorney, said in an interview.

Tribune’s creditors, which are owed $13 billion, would have the right to object because of their claim to the company’s assets. Lawyers for the creditors committee didn’t return phone calls. James Conlan, the lawyer leading Tribune’s bankruptcy, didn’t return phone calls or respond to an e-mail message.

A bankruptcy filing for the 133-year-old team could be the final twist in Tribune’s attempt to sell one of baseball’s trophy properties.

Bankrupt Franchise

The last Major League Baseball bankruptcy occurred in March 1970 when the Seattle Pilots went broke, said Jim Gates, librarian at the National Baseball Hall of Fame and Museum. The Pilots were bailed out by Bud Selig, the current MLB commissioner, and became the Milwaukee Brewers.

Bankruptcy touched another MLB team in 1993, when the Baltimore Orioles were sold for a then-record $173 million in a court auction brought on by owner Eli Jacobs’s personal bankruptcy filing.

A bankruptcy filing by the Cubs wouldn’t indicate that it’s having trouble paying bills, Cross said.

“You do not have to be insolvent to be in bankruptcy,” he said. “All you need is a legitimate business reason.”

Section 363 of the federal bankruptcy code allows a company to sell assets “free and clear” of a lender’s lien and without the creditors’ consent under certain circumstances, he said.

Tribune reported $13 billion in debt and $7.6 billion in assets when it filed for bankruptcy.

Ricketts Deal Possible

Tribune reached a $900 million agreement with the Ricketts family last week for the Cubs and Wrigley Field, a person familiar with the negotiations said at the time.

After predicting a sale as early as January, Zell said in a May 28 interview on Bloomberg Television that the Cubs deal was taking longer than expected because the potential buyer was having trouble raising the money in tight credit markets.

Tribune bought the team in 1981 from the Wrigley family for $20.5 million.

A self-styled “grave dancer” who specializes in distressed companies, Zell, 67, bet on Tribune in the wake of his triumphant exit from the U.S. office market at its peak in February 2007. He sold Equity Office Properties Trust to Blackstone Group LP for $39 billion, including debt, in the largest leveraged buyout at the time, a sale that earned Zell about $900 million.

Ten months later, he made the “mistake” of acquiring Tribune, Zell told Bloomberg Television in April.

A $900 million Cubs purchase by Ricketts would be the highest price paid for a Major League Baseball team, topping John Henry’s $700 million acquisition in 2002 of the Boston Red Sox, Fenway Park and an 80 percent stake in the New England Sports Network.

[Chip R]

Well, they did it.

http://news.yahoo.com/s/ap/20091012/...ubs_bankruptcy