Cubs Bidders down to 5
by nbt on Aug 26, 2008 3:14 PM CDT
40 comments
MLB.com reports that Sam Zell and the Tribune Co. has chosen 5 bidders for rights to the Cubs. Zell has said he wants the team sold by the end of the year, and expects "rapid" approval from owners. I'm still leaning towards Cuban personally, because of his knowledge of how to run a professional franchise but I'm not necessarily against any of the other bidders. I hope the impending sale doesn't affect any off-season signings.
This is a FanPost and does not necessarily reflect the views of SB Nation or Al Yellon, managing editor (unless it's a FanPost posted by Al). FanPost opinions are valued expressions of opinion by passionate and knowledgeable baseball fans.
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This sale is like lingering death. I
realize you don’t sell a billion dollar entity overnight, but this is getting boring.
"Hats for bats.....keep bats warm." - Pedro Cerrano
"Hey bartender, Jobu needs a refill !!!!!!!" - Eddie Harris
by willie mays hayes' gloves on Aug 26, 2008 3:17 PM CDT reply actions 0 recs
We demand a more exciting bidding and sale process!
As I've told you before, I never repeat myself.
by santoswoodenlegs on Aug 26, 2008 3:21 PM CDT up reply actions 0 recs
I think they should decide it with a game of Texas hold em. Winner take all.
Put the whole thing on pay-per-view and everything. It’ll sell like hotcakes.
"Hats for bats.....keep bats warm." - Pedro Cerrano
"Hey bartender, Jobu needs a refill !!!!!!!" - Eddie Harris
by willie mays hayes' gloves on Aug 26, 2008 3:30 PM CDT up reply actions 0 recs
The article...
… names Canning, Cuban and Ricketts as three of the original nine who were approved. It does NOT name any of them as the final five — doesn’t name the five at all.
I assume Cuban and Ricketts are and Canning isn’t, based on what we have heard before. But that link is pretty devoid of specifics.
"That's my opinion and if you don't like it, well, I have others." ~ Groucho Marx
by Al on Aug 26, 2008 3:20 PM CDT reply actions 0 recs
Yeah, that article pretty much lacked any type of information.
by sackings108 on Aug 26, 2008 3:24 PM CDT up reply actions 0 recs
I think there's still a chance that some groups that were "out"..
were told that they could get back “in” by combining resources?
But I can’t see the price being any less that the billion and a third Cuban was said to have bid in the first round. (Unless Zell pulls the ultimate punk move and sells the ballpark separate.)
Last update I heard about, baseball officials were taking a hard look at a Zell plan to make the new owner heavily finance the purchase, just so he could get extra tax breaks.
by The Deputy Mayor of Rush Street on Aug 26, 2008 3:32 PM CDT up reply actions 0 recs
Yeah, I heard about that tax plan too.
This may not happen as “rapidly” as some think.
"That's my opinion and if you don't like it, well, I have others." ~ Groucho Marx
by Al on Aug 26, 2008 3:33 PM CDT up reply actions 0 recs
Sorry
The tax issue aside, it can happen quickly and it will happen quickly. It has to or the Trib will default on their debt.
by Ivychat on Aug 26, 2008 3:34 PM CDT up reply actions 0 recs
We'll see.
"That's my opinion and if you don't like it, well, I have others." ~ Groucho Marx
by Al on Aug 26, 2008 3:36 PM CDT up reply actions 0 recs
Taxes
The tax plan and the speed are seperate issues. The Trib needs cash by hard dates. The question is: how much cash can the sale generate? Even if the sale is fully taxed, they still receive enough cash to cover the next two debt payments.
It’s either that or default.
by Ivychat on Aug 26, 2008 3:38 PM CDT up reply actions 0 recs
And if they default...
… what happens to the Cubs, if they are not sold by default time?
"That's my opinion and if you don't like it, well, I have others." ~ Groucho Marx
by Al on Aug 26, 2008 3:50 PM CDT up reply actions 0 recs
I believe the law states that...
they are to be automatically awarded the NL pennant. But I may have misread fome of the lawyer speak. It’s confusing.
As I've told you before, I never repeat myself.
by santoswoodenlegs on Aug 26, 2008 3:52 PM CDT up reply actions 1 recs
I'd be highly in favor of that sort of law.
"That's my opinion and if you don't like it, well, I have others." ~ Groucho Marx
by Al on Aug 26, 2008 3:53 PM CDT up reply actions 0 recs
Up to the lenders and the agreements
If the Trib is thrown into BK, everything is on the table. What would be fun to watch is a court forcing a sale to a bidder. How would MLB rules then apply about approving a sale?
Court says: Sell to hightest bidder
Cuban: That’s me!
MLB/Selig: No way.
Court: _________
Filling in that blank would be a ton ’o fun.
by Ivychat on Aug 26, 2008 4:02 PM CDT up reply actions 0 recs
Yeah, it would.
"That's my opinion and if you don't like it, well, I have others." ~ Groucho Marx
by Al on Aug 26, 2008 4:11 PM CDT up reply actions 0 recs
Court: Suck It Trebek Selig.
As I've told you before, I never repeat myself.
by santoswoodenlegs on Aug 26, 2008 4:22 PM CDT up reply actions 0 recs
Just barely make the first...
From what I could gather the next payment Zell needs to make is $593 mil in June.
http://www.bostonherald.com/sports/baseball/other_mlb/view.bg?articleid=1115250&srvc=rss
Without the fancy “avoid capital gains tax” finances that MLB doesn’t allow the taxes on a $1B+ sale would be up to $400mil.
http://www.chicagotribune.com/business/chi-wed-cubs-debtaug13,0,7898928.story
That would leave just over $600mil to make that next payment so they’d be cutting it pretty close.
by CubFan81 on Aug 27, 2008 10:01 AM CDT up reply actions 0 recs
Which...
…is why this will happen quickly. They have to have the cash. And the bid was $1.3bn. Taxed at 40%, that would leave $780mm to cover the June payment.
by Ivychat on Aug 27, 2008 2:51 PM CDT up reply actions 0 recs
Zell wants
borrowed cash, which comes with it some bizarre tax dodge. The problem is that it violates MLB debt-to-asset ratio rules.
Borowy . . .Sutcliffe . . .Harden?
by Josh77 on Aug 27, 2008 3:35 PM CDT up reply actions 0 recs
Not true
MLB wants debt limits to prevent banks from forclosing on the trademarks. The LLC they are talking about creating would likely be bankruptcy remote from the Cubs to get around your mistaken absolute that “it violates MLB” debt limits.
If the transaction were such that MLB was assued that the Cubs could not be foreclosed on, then MLB could not object.
by Ivychat on Aug 27, 2008 4:44 PM CDT up reply actions 0 recs
Sorry about the inaccuracies
I edited it
The critical thing to understand is that major-league pitchers don't appear to have the ability to prevent hits on balls in play. There are many possible reasons why this is the case, and I don't really have a concrete idea as to why it is.
But the one thing I do know is that it is the case.
--Voros McCracken
by nbt on Aug 26, 2008 3:44 PM CDT up reply actions 0 recs
Wrong Lede
The story here is not that 5 groups are left. That’s news older than Orton Starts, Grossman Benched.
No, the real story is taht Zell expects “rapid” approval of the sale. That means, “Bud, I’m selling to who I tell you I’m selling to.”
by Ivychat on Aug 26, 2008 3:29 PM CDT reply actions 0 recs
Junk
Trib credit rating has just been reduced to CCC which is essentially the rating of a company at its bankruptcy stage. So Zell needs cash and can’t borrow to make payments. There is added pressure to reduce the tax burden of the Trib’s capital gains from the Cubs sale. So really, it seems that the overriding issue is negotiating a 5% ownership stake in the team after the sale for a certain number of years. That would eliminate the capital gains tax, I believe.
I’d guess as soon as that negotiation is completed, the sale will be announced. And if Selig thinks he’s going to tell Zell to whom and on what terms the club will be sold, he’s sadly mistaken. As I see it, Zell has only one way to go and he’s not about to let Buddy Boy rain on that parade.
If you like Selig's handling of the steroid issue, you'll love his choice for next Cub owner.
by tharr on Aug 26, 2008 4:01 PM CDT reply actions 0 recs
Close
They are still at B-, not CCC yet.
And it’s not cap gains that are the issue. It’s “built-in gains” that are the issue.
by Ivychat on Aug 26, 2008 4:07 PM CDT up reply actions 0 recs
No they are not
Fitch Ratings cut Tribune Co.’s credit rating further into “junk” status Friday - to “CCC” from "B" — and said more reductions may come within a year if newspaper advertising revenue declines keep accelerating.
Also this:
For the Cubs transaction, a new owner also would have another hurdle: The buyer could not start paying down debt until Jan. 1, 2018. That’s the 10th anniversary of Zell’s Tribune acquisition, in which he converted the company to an S corporation from a C corporation. In the 10 years after a conversion, an S corporation must pay taxes on asset dispositions. After 10 years, the capital-gains requirement expires.
If you like Selig's handling of the steroid issue, you'll love his choice for next Cub owner.
by tharr on Aug 26, 2008 5:10 PM CDT up reply actions 0 recs
Whoops
The just got cut to CCC on Friday. More Orton starts, Grossman benched.
by Ivychat on Aug 26, 2008 4:10 PM CDT reply actions 0 recs
I'm reading tea leaves
but I’m pretty sure that Cuban would not get blocked by MLB. For one, the dire financial situation of the Tribune, which is MLB is not insensitive to.
But my tea leaf reading is Peter Gammons column from a few weeks ago in which he talks about how great an owner Cuban would be. If there is a greater mouthpiece for the baseball establishment than Gammons is, I don’t know about him. If Gammons were working on a column like this an the owners intended to block Cuban, one of his buddies in MLB would have called him up and said “You know Peter, there are some real problems with Mark Cuban as a baseball owner” and he would have written a different column. Since Gammons has not followed up his column with his “sources inside baseball” complaining about Cuban, I think he gets approved.
Now that doesn’t mean he wins the bidding, though. That’s a different issue.
Borowy . . .Sutcliffe . . .Harden?
by Josh77 on Aug 26, 2008 5:03 PM CDT reply actions 0 recs
Pray for the Ricketts
They are best hope for the Cubs.
by MDBNIU on Aug 26, 2008 6:58 PM CDT reply actions 0 recs
Reasons?
Let my ashes blow in a beautiful snow from the prevailing 30 mile an hour southwest wind...
When my last remains go flying over the left field wall, I'll bid the bleacher bums adieu,
And I will come to my final resting place, out on Waveland Avenue. --Steve Goodman
by NotSure on Aug 26, 2008 11:00 PM CDT up reply actions 0 recs
2nd that
Why? Because they own TD/Ameritrade and you (MDBNIU, not you NotSure) has an acct there….?
My reason for DON LEVIN is his lifelong Cubs fan association, successful CHICAGO business man and owner of the 4-time league champion CHICAGO WOLVES. Hey, how much would all of us like to talk about the Cubs 4 WS titles in only 11 seasons?
Sweet Lou for Mayor in '11.
by blackhawk24 on Aug 27, 2008 12:26 PM CDT up reply actions 0 recs
'Cept
Levin is out now and has said he’s not getting back in.
Borowy . . .Sutcliffe . . .Harden?
by Josh77 on Aug 27, 2008 1:03 PM CDT up reply actions 0 recs
Which is a damn shame.
"That's my opinion and if you don't like it, well, I have others." ~ Groucho Marx
by Al on Aug 27, 2008 1:47 PM CDT up reply actions 0 recs
Back up your claim, please.
"That's my opinion and if you don't like it, well, I have others." ~ Groucho Marx
by Al on Aug 27, 2008 9:03 PM CDT up reply actions 0 recs
Avoid the clap, Jimmy Dugan
That’s good advice!
by The Deputy Mayor of Rush Street on Aug 26, 2008 11:07 PM CDT up reply actions 0 recs
Well I see...
Bud Light’s hand puppet is back in the fold…SURPRISE! My guess is it won’t have to happen in any near term time frame (e.g. less than 3 months). Sammy boy owes less than $600M come end 2Q09 and that can be made by selling just one other asset like the Baltimore Sun and maybe a small TV station.
I’m most worried that the slime-bag that owns the team 9 miles South, along with Bud Light and his cronies will get Mr. Hand Puppet in there regardless of what Cuban (or still my favourite DON LEVIN) can do.
Sweet Lou for Mayor in '11.
by blackhawk24 on Aug 27, 2008 12:24 PM CDT reply actions 0 recs
Ummm Hellooooo?
Read the article. Canning is NOT in, he was just part of the original 9 bidders.
Also, Levin is out and NOT getting back in per an interview he gave.
by Ivychat on Aug 27, 2008 2:47 PM CDT up reply actions 0 recs
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