Breaking News: Federal Bankruptcy Judge's Ruling Puts Texas Rangers' Sale on Hold
Back when Chuck Greenberg, Tom Hicks and Nolan Ryan thought a prepackaged Chapter 11 would expedite the Rangers' sale
U.S. Bankruptcy Judge Michael Lynn's memorandum of opinion in the Texas Rangers' Chapter 11 case just appeared on PACER, oh, 15 minutes ago? And it's below, all 28 pages. And: It would appear to be a good day for the creditors, as Lynn writes that he ain't OK'ing nothing till the creditors sign off on the Rangers' prepackaged bankruptcy, which Hicks Sports Group must amend before a sale can proceed.
Per Sports Business Journal-er Daniel Kaplan's Twitter account, moments ago: "Federal Judge finds TX Rangers creditors are impaired; likely means they can block the sale. Said source close to creditors: 'This is great news ... means plan is not confirmable.'" More to come.
Update: A good Friend of Unfair Park, who happens to be a local bankruptcy attorney, summarizes thusly for those of us who were not smart enough to go to law school:
If the creditors are happy, it's because Lynn didn't just completely pour them out. He is not going to confirm the plan as it now stands, but all Hicks has to do is amend the plan to pay the creditors interest on their 75MM.
Once the new plan goes on file, the two Rangers equity companies have to re-vote to approve it. In order to scuttle the deal now, the creditors have to figure out a way to take control of the Rangers equity companies so they can cast the vote the way they want. The involuntary bankruptcy cases that the creditors filed against the Rangers equity companies may eventually get the creditors some control, but not soon enough I'll bet. Later, I think Kaplan et al will realize the creditors (Monarch) just won the battle and lost the war.
Update at 5 p.m.: After the jump you'll also find a comment from the Texas Rangers Baseball Partners, just sent by Rick Ericson of the LeMaster Group.
Update at 7 p.m.: Also after the jump, a just-in statement from the Ad Hoc Group of First Lien Lenders.
Texas Rangers Baseball Partners Statement:
"We are pleased that the Judge remains committed to completing the sale of the Rangers expeditiously and we are confident that necessary changes to the plan can be made to achieve that outcome."
"Texas Rangers Baseball Partners wants what is best for the Rangers and supports an independent review of the Greenberg-Ryan transaction. During the review, Nolan Ryan and the Rangers management team will continue to direct and administer the Club under Mr. Hicks' ownership."The Ad Hoc Group of First Lien Lenders (collectively, the "Lenders") in the Texas Rangers Baseball Partners ("TRBP") bankruptcy matter today issued the following statement in connection with today's Court ruling:
"We welcome today's developments, in which Judge Lynn upheld the Lenders' initial and long-standing conviction: that the current plan to sell the Texas Rangers impairs the Lenders, as well as Rangers Equity Owners, and gives them a right to consent to the proposed sale. Also, in today's hearing, Judge Lynn confirmed the parties' agreement to the appointment of William Snyder as a Chief Restructuring Officer of the Rangers Equity Holders,an independent fiduciary charged with ensuring that the plan that is put forward is in the best interests of the creditors of these equity holders, including the Lenders, who have claims of more than $500 million against those equity holders."
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