Sale of Cubs May Be Completed Before End of Civilization
Some more news has trickled out on the impending sale of the Cubs and Sam Zell is hinting that the Ricketts may not be the new owner afterall (emphasis added).
"These are very difficult times. These are difficult
times to arrange financing," Zell said in an interview, adding that if
the Ricketts deal falls through, he is confident the media
company--which filed for Chapter 11 bankruptcy protection in
December--will find another buyer for the ballclub.
"We’ve made it very public that the Cubs don’t fit into the long
term picture of the Tribune," he said. "So if the Ricketts deal doesn’t
get done, I’m sure there will be other ones."
Sure, a lot of people have $900M or so lying around to spend on the Cubs as evidenced by the three legitimate bids Zell actually received. Of those three bids, Ricketts was supposedly not the highest but offered the most money up front, so if financing is the issue, a deal that would require even more to be financed is probably not going to have much more luck than the Ricketts are having now.
Of course...financing really isn't the issue it appears. According to this story dated May 19th, the Ricketts already secured a little over $850M of that $900M original bid; $403M from the sale of stock in Ameritrade and another $450M secured in bank loans (Clarification: Technically $753M is secured with a $100M coming from a private placement by Barclays which we do not know the status of, although the Ricketts claim they can cover it if it falls through). There was that story of Ricketts looking for 10 or so investors at $25M a pop, including celebrities like John Cusack, Bill Murray and Jim Belushi, but that round of financing was supposedly not critical to get the deal done according to "sources". Crain's Chicago Business also echoes that the financing is already in place and explains the real delay.
Thomas Ricketts, who is leading his family’s bid for Tribune Co.’s Cubs, has lined up financing for the deal, but a dispute over price is delaying the transaction.
The Ricketts family, whose original bid was close to $900 million, now
believes the real price should be closer to $850 million, a source
said. The sides disagree over the value of the team’s multiyear
contract to broadcast games on Tribune’s WGN network.
At issue is about $40 million to $50 million — roughly 6% of the
original bid, which also includes Wrigley Field and a 25% stake in
regional cable channel Comcast Sports.
So the Ricketts are either short $50M in financing and trying to talk Zell down or they really are unhappy with the broadcast rights. I'm going with option B here. It appears the Tribune made sweetheart deals with WGN radio and television to broadcast the Cubs games at below fair market value for a contract up to 10 years sometime last fall. Ricketts isn't buying any stake of WGN, but is supposedly getting a 25% stake in the Comcast sports channel that already broadcasts about 80 games a year. So naturally, if he owns the cable company he'd like more games to go on there or be sure he's getting paid the appropriate amount in any licensing deal to WGN.
So don't believe the Zell lies, the money is there for Ricketts, Zell just isn't liking the terms.
Hat tip to waxpaperbeercup that has been all over the sale process, also check out Mark Cuban's blog on why he bowed out and wasn't going to pay anything near the $1 billion asking price at this time. End of the world coming Decemeber 21st, 2012...John Cusack (Cub fan) is starring. Coincidence? I think not.
Thanks guys! Pretty sure Bill Murray says thanks too.
Awesome job, Tim!
Outfielder Chris Young signs "multiyear" contract w BoSox.
Wow, Dombrowski is a buffoon
Not sure I understand the logic, especially for more than one year.
well, that's the past. we're left with the present. even though that past you're seeing is some weird black/white either/or where hybridization of ideas isn't allowed...nonetheless...
the present is ice skating, movies, concerts, beer gardens, hotels, office space and other wonderful baseball activities based around a young, successful baseball team.
All money making ventures, which would have been offset with a reasonable TV contract that previous ownership screwed up
Nah, I'll probably just contemplate how they should've done a Padres-style all-in plan.
of course not. maybe go ice skating and think about it a while. make advanced reservations at the hotel they're starting construction on. check new releases for possible entertainment from the movie screens they want installed. think about renting an office in the new office spaces. write a letter to the cubs requesting your favorite beer be added to the beer garden. lobby your favorite band to play the outdoor venue.
...and in between that maybe they can find $40-50m to invest in the product that all of this revolves around.
let's not get caught up on phrasing for a setup and lose the gist of the post. i don't care what one wants to call the playoff exit.
+they lost their playoff attempt
there. now we can focus on something other than not liking the tone of a line that's setting up a point.
I didn't like the entire post, if that helps.
Making the NLCS with a young team = "crapping out of the playoffs with a young team."
I'm guessing 3/30 and all the two foot long hot dogs you can eat didn't work
Yes! In a 12-way tie for first!