The Trouble With Money And A Sports Franchise Owner Is ?
I don’t know about you but I’ve always been suspicious of owners who’ve cross ownership in a number of teams . That includes Philip Anschutz who’s a minority owner in the Los Angeles Lakers . Apart from the part ownership in the Lakers and the ownership of the team’s home venue the Staples Center in Los Angeles, California. The billionaire entrepreneur and businessman also owns a minority or majority stake in at least MLS soccer teams. Now you might ask why it is that I’m bring this up ? Well the reason is while Anschutz has been an owner who has been duly diligent in letting his subordinates run the various entities of his sporting interests. His prized asset may well be the Los Angeles Galaxy . A major draw in the MLS because of its star David Beckham . Anschutz’s sporting interests are retained in his holding company AEG (Anschutz Entertainment Group)
In MLB ( baseball) there is a worrying situation that is arising, that if it goes unchecked could have some serious ramifications for the league and in particular the Texas Rangers under the ownership of Tom Hicks . The present owner of the Rangers as well as the NHL’s — Dallas Stars as well as the Premiership’s (EPL) Liverpool FC . Through his Hicks Sports Group as the holding company of all three sporting entities . The glaring situation that has come to light is that the Hicks Sporting Group is laden with a great deal of debt, of which Hicks as the principal owner, has refused to acquiesce to meet with his creditors and accept what many believe is a sound option in Hicks and the group remaining solvent. Hicks doesn’t wish to relinquish control of the group or any of the assets within.
Courtesy of USA Today & Associated Press
BOSTON (AP) — Texas Rangers owner Tom Hicks says he feels caught in the middle and can only just watch the stalled proposed sale of the club to Chuck Greenberg’s group.
On the field at Fenway Park before the Rangers played the Boston Red Sox on Wednesday night, Hicks said the dispute is over the what lenders think the team is worth.
“The lenders have to agree with baseball and the buying group that it’s the right price,” Hicks said. “There is some concern that they think somebody will pay a higher price. That’s what the dispute’s all about.”
Baseball commissioner Bud Selig doesn’t seem to be happy with the slow pace.
“Major League Baseball is currently in control of the sale process and will use all efforts to achieve a closing with the chosen bidder,” MLB said in a statement. “Any deviation from or interference with the agreed upon sale process by Mr. Hicks or any other party, or any actions in violation of MLB rules or directives will be dealt with appropriately by the commissioner.”
The sides announced an agreement on Jan. 23, but creditors of the Hicks Sports Group, which owns the Rangers and the NHL’s Dallas Stars, have not approved it.
“Right now I feel like a guy in the center court of a tennis match, watching it go back and forth,” Hicks said. “We’re not really involved in it because we don’t get any of the proceeds. It all goes to the lenders.”
Bob DuPuy, baseball’s chief operating officer, said Tuesday he was “disappointed it’s not closed yet.”
“I thought it would be done by opening day. I thought it would be done by April 19,” Hicks said. “Right now, we’ll all just have to wait and see. There’s nothing I can do.”
In February, Hicks Sports Group announced it had retained Galatioto Sports Partners to look for new investors and explore the idea of selling a majority stake in the Stars.
Separately, Hicks and George Gillette Jr. said Friday they had hired Barclays Bank to lead the search for a buyer for Liverpool, which they co-own under a separate entity.
The Rangers sale eventually must be approved by three-quarters of the 30 teams before it can be finalized.
However, Tom Hicks is now in the midst of an acrimonious business deal in trying to divest himself of his majority stake in the Rangers . Noted Philadelphia attorney Charles Greenberg has tendered an offer to purchase the team. Hicks is unwilling to accept the offer believing it to be derisory and that it undervalues the asset. My question to Hicks , what you deem to be a derisory offer is more than apt, given the fact that the Rangers is not only overvalued by your own estimation but the mere fact that the team is also laden with debt. And while this is all going on , one has to wonder what the thoughts are of the commissioner’s office ? In particular that of Bob DuPuy who is the President & Chief Operating Officer MLB .
It is DuPuy’s responsibility not only to monitor the situation at the behest of Commissioner Bud Selig . But it is also DuPuy’s responsibility to monitor such instances concerning a team’s financial stability. And given the fact that well over 60% of the team’s within the league at present are having some serious financial difficulties . And this isn’t merely because of the acute economic climate of the country at present. But this also stems from the fact that as a concern, the business template of baseball isn’t as sound as the commissioner would have us believe.
The effect of this all isn’t just being felt by the small market teams but also teams in the large markets as well. Large salary structured teams are most definitely having some severe financial problems. And that included the newly minted World Series champions the New York Yankees . Having moved into their palatial new edifice also called Yankees Stadium . Games at the ballpark haven’t always been filled to capacity. That being said the front office can offset those losses by the mere fact that its YES Network broadcast outlet is a “gargantuan cash cow” for the organization. And the Yankees’ divisional rivals the Boston Red Sox are in a similar vein wherein they can recoup any losses from its stadium operations via its NESN cable operations . There aren’t too many teams within baseball that can afford itself that sort of a luxury. For the Steinbrenner family as the principal owners of the New York Yankees and for both John Henry and his partner Tom Werner as owners of the Red Sox, they know that while they’re viewed as the “fat cats” around the league. There’s also a great deal of disdain in the fact that both of these organizations are amongst the highest salaried teams in the league.
While Tom Hicks is in the midst of this battle , I ought to let you know that he’s also facing a great deal of friction amongst his partner Ken Gillette and the Liverpool fans. Once again Hicks has laden the club with a great deal of debt which is in the region of $600 million . And it has created a chasm between owners and that of the team’s coach Rafael Benitez . Because of that the team if it is to acquire new players in order to remain competitive not only within the Premiership but also on the European front . Then they will have to sell off their best players, in order to replenish the team’s roster. For many disgruntled Liverpool fans they now feel that Hicks and his partners ought to be kicked out not only of the boardroom but also as owners of the soccer club.
There seems to be this myth that Hicks and Gillette are astute businessmen . And that may well be the case in their corporate endeavors in the business world . But as owners of their sporting entities they have proven to be a complete and utter bust ! I’ve heard it said that Hicks has taken the Rangers and made them a viable concern in the AL West. Well considering that this team has yet to prove itself in the postseason . You have to wonder how some would define success ? This is the same organization that made a big splash in obtaining Alex Rodriguez as a free agent and then proceeded to offer him the largest contract sports history . At the time he was offered a ten year $250 million contract. The problem was that within three years A-Rod had departed for the more competitive oriented climes of New York and the boys in “Pinstripes” . What made the situation all the more absurd was for the remaining seven years of the contract the Texas Rangers were still paying the major part of the player ’s salary , even though he was no longer a member of the team. And this is what is meant to be a sound business practice in the game of baseball ? No wonder the league and many of its teams are said to be in such a mess. !
Alan Parkins aka tophatal ……………..
Pink Floyd ………………….“Money”