Hicks Sports Group Creditors Threatening bankruptcy for the Rangers

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It’s hard to tell if this afternoon’s BusinessWeek report represents something truly new or if it’s more of a rehash of what we already know, but for the record:

The Texas Rangers, the Major League Baseball team
controlled by billionaire Thomas Hicks, may be forced into bankruptcy
unless terms of a planned sale of the team are improved or another buyer
is found, according to two people familiar with the matter.

Creditors led by Monarch Alternative Capital may
block Hicks Sports Group LLC, which defaulted on $525 million of debt
last year, from selling the Rangers and try to put the team into
bankruptcy, said the people, who declined to be identified because the
debt talks are private. The creditor group, which includes CIT Group
Inc. and Galatioto Sports Partners LLC, is seeking at least $30 million
more from the team’s sale, one of the people said.

The dynamic is the same that we’ve seen all along: Hicks’ creditors want more money, they’re threatening to force the team into bankruptcy if they don’t get it. Based on the tone of the article and based on the positions the parties have taken in the past, my guess is that the source for this specific report is one of the creditors, trying to ratchet up the pressure. The whole thing works best if you read it in a “and this time we really, really mean it” tone.

Not that it’s an empty or meaningless threat. No one ever gets rich forcing one’s opponent into bankruptcy, but this may one of those situations where it makes some amount of sense. The biggest problem of bankruptcy is the delay it causes in the asset in question getting liquidated, which often diminishes its value. The nut of this dispute, however, is Hicks’ proceeds from a land sale to Greenberg along with the Rangers. Land for mixed-use development — which is what this land, next to the Ballpark, is — is likely about as down in the dumper as it’s ever going to be right now.  Yes, bankruptcy will cause everyone to incur costs in the short term, but if the whole thing gets tied up for months or longer that same piece of land is still going to have to be disposed of in the end, and there’s every reason to believe that it will be worth more later than it is now.

But however that shakes out — and there are a million ways it could shake out — this report can be viewed as a signpost.  A week ago it was reported that Major League Baseball was stepping in to try and persuade the creditors to get the deal done. At the time Greenberg made noises that it would get done next week. The next thing we hear from the creditors is a renewed bankruptcy threat.

What to make of it? Perhaps they are not all that impressed with Mr. Selig’s efforts to play peacemaker. Perhaps they are not all that impressed with Mr. Greenberg’s public statements of inevitability.  Perhaps no one — not Hicks, not Greenberg, not baseball, not anyone — has enough money to wave at Hicks’ creditors to make them think that they’d get all that worse a deal in bankruptcy court. Hard to say.

The only thing that is certain in all of this is that Greenberg will come out with a statement in the next 48 hours in which he tells us, once again, that the deal is almost done. Because that’s what he always does.

(Thanks to Kevin T. for the heads up)

Report: Teams reluctant to gamble on Cliff Lee

Philadelphia Phillies starting pitcher Cliff Lee throws during the first inning of a baseball game against the Washington Nationals at Nationals Park Thursday, July 31, 2014, in Washington. (AP Photo/Alex Brandon)
AP Photo/Alex Brandon
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In Saturday’s column for the Boston Globe, Nick Cafardo suggests that free agent Cliff Lee is seeking a guaranteed major league deal between $6 and $8 million plus incentives. That is turning some otherwise interested teams away, as the lefty is still recovering from a torn flexor tendon in his left elbow. Lee hasn’t pitched since July 31, 2014.

Last month, Lee’s agent Darek Braunecker said the pitcher would need “a perfect fit” to pitch in 2016. He also noted that Lee has begun a full offseason throwing program.

In his most recent season, Lee compiled a 3.65 ERA with 72 strikeouts and 12 walks in 81 1/3 innings for the Phillies. The Phillies had signed him to a five-year, $120 million contract in December 2010 but declined a club option for the 2016 season, instead buying him out for $12.5 million.

Orioles reconsidering signing Yovani Gallardo

Yovani Gallardo
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In an article for MASN on Friday, Steve Melewski noted that the Orioles were reluctant to forfeit their first round draft pick (14th overall) in order to sign free agent starter Yovani Gallardo. The club is now reconsidering its stance and rechecking the right-handers medicals, MASN’s Roch Kubatko reports.

Gallardo, who turns 30 on February 27, posted a 3.42 ERA with 121 strikeouts and 68 walks over 184 1/3 innings for the Rangers last season. The Rangers had acquired him in a trade with the Brewers, sending Luis Sardinas, Corey Knebel, and minor leaguer Marcos Diplan to Milwaukee.

Gallardo has posted an ERA below 4.00 in six of his last seven seasons. He remains unsigned into February, however, because his strikeout rate has rapidly decreased with each year since 2012. Per FanGraphs, that rate was 23.7 percent in 2012, then went to 18.6 percent, 17.9 percent, and 15.3 percent progressively. Some of that may have to do with diminishing fastball velocity, as Gallardo’s 90.4 MPH average marked a career low among his eight full seasons with at least 100 innings pitched.

The Orioles lost starter Wei-Yin Chen, who signed with the Marlins, and the back end of their rotation is highly speculative with Kevin Gausman, Mike Wright, Odrisamer Despaigne, and Tyler Wilson. Adding a veteran like Gallardo, even if he is apparently declining, may be stabilizing.

Freddy Garcia is calling it a career

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MLB.com’s Jesse Sanchez passes along word from the Dominican Republic that right-hander Freddy Garcia will hang up his cleats for good after Sunday’s Caribbean Series championship game.

Garcia will start that game for the Tigres de Aragua out of Venezuela. He’s taking on Mexico’s Venados de Mazatlan.

“Venezuelan fans are expecting something good from Freddy and so is everybody,” said Tigres de Aragua manager Eddie Perez, who also serves as the bullpen coach for the Atlanta Braves. “Knowing that it’s his last game is going to make it very special. We all hope he pitches a really good game so he can retire in a good way and bring the title for Venezuela. Everybody who is rooting for Venezuela expects him to do well.”

Garcia’s last major league game was in the 2013 postseason. The 39-year-0ld will finish with a 4.15 ERA, 1.30 WHIP, and 6.4 K/9 in 2,264 career regular-season innings. He had a 3.26 ERA in 11 playoff starts, winning a World Series title with the White Sox in 2005.

Video: 2016 will be a season to remember

Carlos+Correa+Houston+Astros+v+Arizona+Diamondbacks+Ctyu5RiU3SWl
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MLB.com put together this very cool video montage reviewing the 2015 season and setting us up for what should be a wild 2016. Young stars, veterans chasing milestones, unpredictable divisional races.

It’s so close to spring training. Let’s do this.