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Off Pitch articles thread
RedJam70:
Ok for those that don't want the speculation I'll try to keep this thread updated with any articles posted in the other threads. Tis what it was intended for anyway.
--- Quote from: HarryLabrador on April 14, 2009, 09:15:19 am ---APRIL 14, 2009
Creditors Find Hicks Sports Group in Default
By MATTHEW FUTTERMAN
Creditors to Texas financier Tom Hicks's Hicks Sports Group have declared the company in default, a measure that could eventually dislodge the Texas Rangers baseball club and Dallas Stars hockey franchise from his control.
The default notice is the strongest sign yet of the economic perils awaiting the country's professional sports leagues, where owners have spent lavishly on player salaries. Many owners' personal fortunes are also on the wane, creating uncomfortable standoffs between the owners and lenders.
In Mr. Hicks's case, a group of 40 financial institutions and other investors hold $525 million in debt. Galatioto Sports Partners, a New York sports-financing group, holds the largest position, having lent nearly $100 million to Hicks Sports Group.
Mr. Hicks missed a $10 million quarterly interest payment on March 31, triggering the default notice. The teams are unable to fund both their operating expenses and debt service, and Mr. Hicks has declined to continue making up the difference out of his own pocket, according to a person familiar with the matter.
[tom hicks and creditors and default] Associated Press
Tom Hicks, right, pictured with Dallas Cowboys owner Jerry Jones last April, missed a $10 million quarterly interest payment March 31.
That has angered some of the lenders -- a collection of large banks and smaller investment funds -- for whom the default notice begins a process that could put the banks in control of the teams. That won't happen for at least 180 days, however, as lenders have agreed to National Hockey League provisions that prevent immediate foreclosure. Major League Baseball's rules for such situations are more fluid, though if Hicks Sports Group can't satisfy lenders, the lenders can eventually force an MLB-sanctioned sale of the Rangers.
Mr. Hicks can fix the situation, and remain in control of the teams, by paying off his current debt or by reaching a new deal with his lenders, which he is trying to do.
A spokesman for NHL Commissioner Gary Bettman declined to comment. Bob DuPuy, chief operating officer of Major League Baseball, also declined to comment.
Relations between the Hicks Sports Group lenders and the NHL have grown increasingly testy of late, with the NHL threatening to do all it could to block a forced sale of the Stars, according to people involved in the matter.
In the meantime, Mr. Hicks is trying to fashion a deal of his own, by selling a minority stake in the Rangers and Stars. He said he plans to fund operational losses of the teams but wants the banks to cover interest payments.
"I'm confident that I'll be able to reach agreement with 51% of the lenders because I will be able to fund all the cash needs of the two teams during the period that I'm bringing in new partners, which will help us to drastically reduce if not eliminate HSG's debt," Mr. Hicks said in an interview. "These are great sports franchises and they're valuable assets and I want to make sure I have ample time to identify appropriate partners to invest at a fair value."
Mr. Hicks has been one of the most high-profile figures in professional sports, having purchased the Rangers in 1998 from a group of owners that included former President George W. Bush. Under Mr. Hicks's ownership, the Rangers signed shortstop Alex Rodriguez to a 10-year, $250 million contract. This year the Rangers' payroll is about $68 million, and is in the bottom third of MLB. The Stars, meanwhile, became the most successful of the NHL's franchises in the South, winning the Stanley Cup in 1999.
In 2004, Mr. Hicks stepped down as chairman of Hicks Muse Tate & Furst Inc., the private-equity firm that he co-founded.
Today Mr. Hicks operates Hicks Equity Partners, a private-equity arm of his investment firm. He is currently trying to close a $3.2 billion deal announced last June in which a Hicks investment vehicle would acquire a majority interest in plastic-container company Graham Packaging Holdings from the Blackstone Group.
Separately, Mr. Hicks has a $400 million loan from the Royal Bank of Scotland due in July, used to fund his purchase of the Liverpool soccer team in the English Premier League. Mr. Hicks splits ownership of the team with Colorado businessman George Gillet. To raise cash, Mr. Gillet is also moving ahead with a sale of his controlling stake in the NHL's Montreal Canadiens.
The trouble for Hicks Sports Group has been brewing for months, as the poor economy has dried up interest in sponsorships and ticket sales. Late last month, just days before the payment was due, Mr. Hicks informed the lenders he wouldn't make the payment. On April 6, the lenders found Hicks Sports Group in default.
—Peter Lattman contributed to this article.
Write to Matthew Futterman at matthew.futterman@wsj.com
http://online.wsj.com/article/SB123967866588416173.html
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RedJam70:
--- Quote from: HarryLabrador on April 14, 2009, 06:43:57 pm ---More speculation.
=========================================================
Liverpool's future could be decided by Celine Dion
Tuesday, April 14, 2009
Liverpool co-owner George Gillett is on the brink of raising an estimated £272m from his 80 per cent interest in the Montreal Canadiens by selling them to pop star Celine Dion.
The Think Twice and Power of Love singer is one of the leading bidders hoping to snap up the National Hockey League team.
Other potential buyers including Cirque du Soleil founder Guy Laliberte and Quebec cable giant Quebecor Media.
The Bank of Montreal has signed confidentiality agreements with ten potential suitors who have until 5pm on Thursday to submit formal bids to Denver-based Gillett.
As well as buying the Canadiens, the successful bidder will acquire the Bell Center arena in Montreal and a concert promotion division.
Gillett wants the cash to strengthen his financial muscle as he prepares for another showdown with fellow Liverpool owner Tom Hicks.
Gillett is reputed to be keen to replace Hicks and is believed to be open to the idea of a new joint ownership scheme at Anfield.
But he would also be willing to stay on as a minority shareholder if investors in Dubai or Kuwait step forward and buy the Premier League club for around £450m.
http://www.metro.co.uk/sport/football/article.html?Liverpools_future_could_be_decided_by_Celine_Dion&in_article_id=619438&in_page_id=43
--- End quote ---
RedJam70:
--- Quote from: HarryLabrador on April 14, 2009, 06:45:32 pm ---20 minutes ago
Is Tom Hicks On The Ropes?
Posted By:Darren Rovell
Topics:Economy (U.S.) | Economy (Global) | Sports
You probably saw the news last week. Texas Rangers and Dallas Stars owner Tom Hicks, who also owns part of the Liverpool soccer club, defaulted on a $10 million payment connected to $525 million in loans.
It’s not the end of Hicks’ ownership reign, but it’s not a good sign, despite what Hicks would have you believe.
When the news broke, Hicks, who famously agreed to give Alex Rodriguez a 10-year, $252 million contract despite the fact that there weren’t teams within a sniff of that deal, played it off. He actually said that he defaulted intentionally.
While there are no immediate penalties for defaulting on a loan like this, it’s not like it hurts his personal credit rating, insiders I spoke to have said that they’ve never heard of a person doing this on purpose.
The next step in the process is for Hicks and those lending the money to sit down and negotiate a new payment schedule and perhaps a new number that needs to be owed.
The catch is that the ability of the lenders to be flexible has little to do with Hicks’ business and more to do with the still frozen credit markets.
So what happens if things can’t be worked out?
Well, the Wall Street Journal notes today that the lenders have agreed not to take control of the Dallas Stars for at least six months, abiding with the National Hockey League provisions that protect a team from immediately going into foreclosure.
So the immediate solution for Hicks is to sell pieces of his teams to raise enough cash to remain the owner or eventually just hand them over to the banks. But, trust me, the banks don’t want the teams. They want the money.
Hicks’ greatest problem might be his inability to accept reality. In mentioning that he’s ready to sell parts of his teams, he has mentioned selling a 49 percent stake, so that he can raise money while still maintaining his majority ownership position.
Not only has the value of his teams probably dropped at least 25 percent because of the marketplace, but the person who is buying has to have more cash than ever before. And someone who doesn’t have a sports team who is going to buy now is going to want majority ownership, if not immediately upon purchase, within a couple years.
The other way it could shake down is if either of the leagues decide to buy the teams for a reasonable price, hoping that they could flip it around when the economy clears up a bit. This actually last worked when Major League Baseball flipped the Montreal Expos and turned them into the Washington Nationals. But in order for the league to buy a team, they have to make sure that contraction is off the table.
http://www.cnbc.com/id/30211713
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electricghost:
http://www.telegraph.co.uk/sport/football/leagues/premierleague/liverpool/5155151/Liverpool-owner-Tom-Hicks-feels-pressure-over-American-sports-debts.html
Liverpool owner Tom Hicks feels pressure over American sports debts
Creditors of Liverpool owner Tom Hicks have formally declared his company Hicks Sports Group in default on debts of $525 million (£351million). The figure was raised against his American sports interests the Dallas Stars ice hockey franchise and the Texas Rangers baseball team.
By Paul Kelso
Last Updated: 7:43AM BST 15 Apr 2009
Liverpool owner Tom Hicks feels pressure over American sports debts
Crunched? Tom Hicks (r) and son Foster at Anfield in February Photo: PA
Hicks, who maintains that his American interests are entirely separate from his 50 per cent holding in Liverpool, was formally served with a default notice last week after missing a $10 million quarterly interest payment due on the loans.
The Texan financier is seeking to renegotiate the terms of the loans with a consortium of more than 40 banks led by Galatioto Sports Partners, a New York sports financing group that has lent HSG nearly $100 million.
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Hicks insists that his decision to miss the payment is a negotiating tactic designed to force the banks to renegotiate in the light of the credit crisis.
The default notice signals the possibility that Hicks could ultimately lose control of the Stars and the Rangers, but a source close to Hicks said that would require the co-operation of National Hockey League and Major League Baseball commissioners, and that they were both supportive of the owner.
Hick's issues in the United States will raise further concern among Liverpool supporters about the club's future. Hicks and co-owner George Gillett are in negotiations with Royal Bank of Scotland over extending a £350 million loan secured in part against the club that comes up in July.
The pair are searching for a third-party investor willing to take a share in the club and help pay down the debt.
Hicks said he would continue to cover the cash needs of the two American franchises going forward while searching for fresh investors, but that he would not make interest payments until the banks come to the table.
"I'm confident that I'll be able to reach agreement with 51 per cent of the lenders because I will be able to fund all the cash needs of the two teams during the period that I'm bringing in new partners, which will help us to drastically reduce if not eliminate HSG's debt,'' Hicks told the Wall Street Journal.
RedJam70:
--- Quote from: heggo on April 18, 2009, 05:05:54 pm ---Gillett seeking $400 million investment
OTTAWA, April 18 (Reuters) - American George Gillett is seeking a partner willing to invest $400 million into a sporting empire that includes Liverpool soccer club and the Montreal Canadiens NHL team, a newspaper said on Saturday.
The French-language La Presse, citing sources involved with the proposed sale of the Canadiens, said such an investment would enable the financially-pressed businessman to hold on to the teams.
La Presse said Gillett had proposed to several business executives that they invest $400 million and
become a junior partner, but had generated little interest so far.
Gillett said last month that he had hired a team of advisors to look at his assets and denied media reports he wanted to sell some of them.
"My family and I regard this possibility as the last resort. We are a lot more interested in some kind of (business) association than in the sale of the Montreal Canadiens or one of our other enterprises," Gillett told the newspaper on Friday.
Gillett owns 80.1 percent of the Canadiens and 50 percent of five-times European champions Liverpool.
Canadian media last week said would-be buyers were being asked to submit formal offers for the Canadiens and several groups had signed confidentiality agreements with the Bank of Montreal's investment banking arm.
Gillett declined to comment on the reports, saying the banking arm had yet to complete its work.
http://football.uk.reuters.com/uk/news/N18354020.php?rpc=401&
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