A League of Her Own

Chicago Cubs Headlines for Saturday August 22, 2009

Even George is surprised that TribCo finally picked a buyer

There's really only one headline for today.  

As you should already know, TribCo announced Friday that it has signed an agreement to sell the Cubs to.....the same damned people who were announced as the buyers 8 months ago.  (Note to the Ricketts family, "damned people" was not meant pejoratively -- I need to see you screw up the team before insulting you, and I have reserved "Chicago's Steinbrenners" for that.) Technically speaking, what the Ricketts got was a "blessing" from the Tribune Company's leading creditors (as TribCo remains in the bankruptcy process), and that allowed for the agreement to be finalized...mostly.   

TribCo says that the Cubs will make a Chapter 11 filing, in order to purge themselves of financial obligations to TribCo (with the expectation of getting out of that process quickly). What happens now is that the bankruptcy judge overseeing  TribCo's bankruptcy has to okay the deal, which is expected.  That said, the bankruptcy judge could go goofy on the Cubs and reopen the auction to see if anyone would offer more than the Ricketts. With TribCo's major creditors on board, however, that seems unlikely.

Finally, the sale must also be accepted by a 75% of MLB team owners at a vote at their November meetings.  That is also expected to occur without problem, as the Ricketts were already vetted by Selig and his unholy band of vampires team of assistants.

Thus, barring a surprise along the way, the Ricketts will get a 95% interest in a package of assets (TribCo retains the other 5%):

  • the team (duh);
  • Wrigley Field (which I predict will have a sponsored name in the not-too-distant future); and 
  • a 25% stake in Comcast SportsNet Chicago (they get a 95% interest in a 25% stake?  I hate to complain, but I was told there would be no math in these headlines).

The agreement between TribCo and the Ricketts values the franchise (and related assets) at $845 million, less than the Rickett's $900 million bid in January 2009.  Surprisingly, there is no indication that Kevin Gregg was the reason for the apparent lowering of the team's value.  Rather, both sides ended up compromising on the media rights....oh, and there's this little recession going on, which is sort of affecting advertising revenue.

Said Joe Ricketts:

Our family is thrilled to have reached an agreement to acquire a controlling interest in the Chicago Cubs, one of the most storied franchises in sports. The Cubs have the greatest fans in the world, and we count our family among them. We look forward to closing the transaction so that we can begin leading the Cubs to a World Series title.

Presuming this deal goes through all the necessary hoops, we at LOHO wanted to take this opportunity to welcome the Ricketts.  From our perspective, these people are the salt of the earth -- hardworking, dedicated, wonderful, benevolent, good-looking, and extremely generous people who we fully expect to treat Cubs bloggers with respect, honesty, and free stuff.  I may have been too subtle there, so I hope the Ricketts were able to get my meaning.  

As for the other news, the Cubs continued their August slide against the Trolley Dodgers last night in a 2-1 loss, despite a strong outing by Randy Wells.  As friend of LOHO Paul Sullivan noted, Lou Piniella had only one word for the loss: "Painful."

Mr. Sullivan has also made a list of suggestions for the Ricketts in order to help them succeed.  You might not agree with all of them ("hire a team shrink" might seem a bit indulgent, although these are a temperamental bunch), but if the Ricketts do nothing else but lower the price of beer at games, I will gladly buy Mr. Sullivan one in the future.  

ESPN's Bruce Levine seems to believe that Paulie's suggestion for a Jumbotron (presuming the requisite officials are able to be bribed convinced of its value) is a foregone conclusion, as the Ricketts are facing a 20-year slog to recover their investment.  I fear that Levine's prediction of personal seat licenses is also a done deal -- and he predicts it to be $20k per year. 

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12 Comments

summerguy said:

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What happens to WGN Radio?

Max Power said:

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As part of the agreement, WGN Radio stays as the Cubs radio broadcast site.

JulieDiCaro said:

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WGN still owned by TribCo, I would imagine.

Max Power said:

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TribCo seems pretty protective of their media holdings. At a minimum, no media properties -- outside of TribCo's interest in CSN -- are part of this deal.

gravedigger said:

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My sincere appreciation for your not mentioning last night's debacle.

secdelahc said:

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So, all of this waiting was for what? To agree to sell the Cubs? I mean, I get that this is more concrete than anything else, but all of the waiting and hoopla seem a bit anti-climactic right about now? I'm more concerned with when everything will be finalized.

JulieDiCaro said:

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so basically, i think, they've reached an agreement with TribCo's creditors as to the terms of the sale (financing, etc). they still have to get approval from the bankruptcy court (which should be a formality because the court isn't going to interfere if the creditors are okay with the sale), and it needs approval of the other owners.

so . . . yeah.

Max Power said:

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The Ricketts reportedly are going to spend $400M cash and finance the rest, and there has been word that Chase and at least one other bank will lending the money. Once that is finalized (and there are discussions that this is pretty much done after the 8 months of BS), I agree that it seems pretty unlikely that a BK judge will not agree with this plan in view of TribCo's main creditors signing off on it. The MLB owners have vetted the Ricketts already, so it's really just the financing (or a surprising turn with either the judge or MLB owners) that is up in the air.

Thus, this appears to be much closer to a done deal than it has in the past. While it technically is just the narrowing down to one bidder, that tends to suggest that a lot of the variables have been answered (and why this kind of deal could not be finalized before now).

baturkey said:

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Are banks allowed to hedge by betting against sports teams? Probably not, I'd guess.

Perkins said:

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Paul Sullivan is a douchebag, and I wouldn't piss on him if he were on fire (just wanted to get that out there).

And if the Rickettses are anything like the Steinbrenners, then hell to the yes. That would be the best thing ever.

Max Power said:

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but I have laid claim to the term "Chicago's Steinbrenners" -- let's just be clear about that.

gravedigger said:

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Agree, and agree.

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