Baseball

News on the Texas Rangers Bankruptcy proceedings   by Jim Knight

Amidst the proliferation of companies filing for bankruptcy, a well-known baseball team filing for Chapter 11 protection does arouse special interest. The Texas Rangers, named after the eponymous law enforcement agency of fame, filed for bankruptcy under Chapter 11 of the US Bankruptcy Code on 24 May 2010. The case is still in court with the teams creditors opposing its sale for $575 million, saying the franchise is worth much more. As of today (2 July 2010), US Bankruptcy Judge D. Michael Lynn has postponed a scheduled conformation hearing on 9 July to 22 July to allow more time for mediation.

Trivia: Chapter 11 is a chapter of the US Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Any business, whether a corporation or a sole proprietorship, can file for Chapter 11 bankruptcy. Although it is available to individuals as well, it is most prominently used by corporate entities with Chapter 13 being preferred for the former. The other option, Chapter 7, governs the process of a liquidation bankruptcy.

The back story of the Texas Rangers Bankruptcy
Founded in Washington, D.C. in 1961 as the Washington Senators, the team assumed its current identity as the Texas Rangers in 1972 after moving to Arlington, Texas. In the primary years of existence, the team did not defend itself in reputation, losing the majority of games played. The then-owner, hotel and trucking leader Bob Short, accepted an propose from Arlington mayor Tom Vandergriff and decide to relocate the franchise to Texas. The decision outraged Washington fans who stormed the final game in the city on September 30, 1971, outstanding to a forfeiture in favor of its opponents the New York Yankees.

The team changed its name and had mixed fortunes throughout the 70s, with 1974 being an especially wealthy year where the Texas Rangers finished the season 84-76 and in second-best position behind the eventual World Series winner Oakland Athletics. notwithstanding, titles continued to elude them, and the decade was considerable by cycles of poor to unexceptional seasons, followed by an infrequent year of near-success, followed by dissatisfaction the following year, then reverting to poor to medium seasons. In 1980, ownership changed hands from Short to oil tycoon Eddie Chiles. The Rangers maintained their hybrid note through the 80s, and in 1989, the team was sold for $89 million to an investment firm that included the future President of the United States George W. Bush.

The Texas Rangers had a superior record in the 90s, enhancing solemn contenders to the playoffs. In 1998, Texan billionaire Tom Childs, who also holds a noticeable stake in English soccer club Liverpool, acquired the team for $250 million. The teams fortunes plummeted shortly after, finishing in last position for four consecutive years from 2000. though, 2004 saw a turnaround and the Texas Rangers finished third in the league. Average results continued till 2009 when it was again in contention for the playoffs. though, prosperity on the field could not overcome the teams financial problems.

Tom Hicks expressed his ambition to sell Texas Rangers in April, but allegations presently followed that he had borrowed money from main League Baseball to meet the teams payroll after his company, Hicks Sports Group (HSG), defaulted on a $525 million loan. On 22 January 2010, HSG officially reached a proper contract to sell the Texas Rangers for $570 million to the group headed by Pittsburgh sports lawyer Chuck Greenberg and Rangers team president Nolan Ryan. though, HSGs creditors, led by Monarch Alternative Capital, contrary to the selling cost as being too downcast. Then, Texas Rangers filed for bankruptcy on 24 May 2010 to expedite the selling through the intervention of the bankruptcy court. The judge has advised mediation between the warring parties.

The current and possible future

As things rise, there are two possibilities:

1. The creditors approve to the proposed selling thereby allowing Greenberg and Ryan take over with enough time to ensign prospectus picks and originate trades previously the 31 July non-waiver trading deadline.
2. The creditors oppose the proposed selling and force the Rangers into involuntary bankruptcy where its assets are offloaded to the highest bidder(s).

Whatever be the end result, 22 July 2010 will confidently be a day to remember for Texas Rangers fans.

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About the Author

The Texas Rangers had a superior record in the 90s, enhancing solemn contenders to the playoffs. In 1998, Texan billionaire Tom Childs, who also holds a noticeable stake in English soccer club Liverpool, acquired the team for $250 million.
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