Bankruptcy Judge Michael Lynn has delayed the reopening of the Texas Rangers’ auction until August 12th, a ruling that has upset both debtors and lenders in the Chapter 11 bankruptcy case that has been mired in controversy since it was filed.
Tuesday’s courtroom tug-of-war featured the Greenberg-Ryan group’s argument that the new auction should occur well before Aug. 12, when its financing agreements purportedly expire. But major lenders wanted a date in September, asserting that an earlier date might not give potential rival bidders – Houston businessman Jim Crane and Dallas investor Jeff Beck – enough time to arrange funding.
“We’re going to get this process on the road,” Bankruptcy Judge Michael Lynn said. “I know this doesn’t make all of us happy. But if that’s so, I’ve done something right in this case.”
The bankruptcy judge said that once the bidding is completed and the winning bidder is approved, the Texas Rangers’ Chapter 11 bankruptcy plan could be approved that day allowing the baseball team to exit bankruptcy within hours of the bidding.
The Greenberg-Ryan group has already upped the ante by increasing the cash portion of their starting bid to $306.7 million from $304 million after shedding some contractual commitments, including a much-criticized aircraft lease. Meaning that if the Greenberg-Ryan group wins the bidding war, the Texas Rangers would emerge from bankruptcy fully repaying former player Alex Rodriguez and other unsecured creditors who are owed a total of about $204 million.
In order for rival bidders to have a chance at seizing control of the Texas Rangers in this bankruptcy case they will need to bid at least $15 million higher than the Greenberg-Ryan group and be approved by the MLB, which has the right to disapprove any winning bid, much to the chagrin of lenders.