Texas Rangers: BANKRUPT. Team getting sold

http://www.foxnews.com/sports/2010/05/24/texas-rangers-declare-bankruptcy-set-sell-team/?test=latestnews

This might not be newsworthy to some but apparently the Rangers have declared bankruptcy. Apparently they don't have enough cash to meet their obligations.

I'd offer them $25M for Elvis Andrus and Justin Smoak if it'll help pay the bills

http://www.zerohedge.com/article/texas-rangers-file-bankruptcy-alex-rodriguez-lose-25mm-deferred-comp-largest-unsecured-credi

This article says AROD could lose $25M in deferred compensation as he's an unsecured creditor. This is according to the bankruptcy filing in the attached pdf.

We'll see how Millwood pitches in his next start, he could lose $12M according to the bankruptcy petition!

Mickey Tettleton and Mark McLemore with $1.4m and $970k in deferred money?!?! That goes back to contracts from 1995 for both. Jezzz....

Hicks is the anti-Angelos. At least Petey makes money with his team. Hicks couldn't win even when backing up the Brinks truck.

http://www.zerohedge.com/article/texas-rangers-file-bankruptcy-alex-rodriguez-lose-25mm-deferred-comp-largest-unsecured-credi

This article says AROD could lose $25M in deferred compensation as he's an unsecured creditor. This is according to the bankruptcy filing in the attached pdf.

We'll see how Millwood pitches in his next start, he could lose $12M according to the bankruptcy petition!

Would Millwood lose $12M or only the $9M that Texas is chipping in?

All of that money spent, not a whole lot gotten out of it, and they're bankrupt. A financial disaster for sure.

Would Millwood lose $12M or only the $9M that Texas is chipping in?

The $12m that he makes for 2010 is not the deferred money that Texas owes him. The deferred money looks to be the signing bonus he got when he signed with the them back in Dec 2005.

# 5 years/$60M (2006-10)

* signed by Texas as a free agent 12/05

* $15M signing bonus (payable 2011-2015)

* 06:$6M, 07:$7.5M, 08:$8.5M, 09:$11M, 10:$12M

* limited no-trade clause

* club may void deal after 2009 unless Millwood has:

o combined total of 540 IP 2007-09, or

o combined total of 350 IP 2008-09, or

o 180 IP in 2009

* club may elect to keep Millwood even if he fails to hit IP totals

* deferred money allows Texas to compute annual average salary at $10.8M

* acquired by Baltimore in trade from Texas 12/9/09, with Rangers paying about $3M of Millwood's 2010 salary

I'm stunned on several levels.

Stunned that the debt situation could have gotten so bad.

Stunned that MLB hasn't stepped in and forced a sale or something before it got to this point.

And really stunned that the obligations to the players could be wiped off the books so quickly and easily, and that individual players might lose this kind of money at the stroke of a pen. Did agents and the union not see this possibility?

This is potentially HUGE. The individual contracts go to the heart of the relationship between the players and clubs. If I were an agent, I would advise my clients to sign only with teams that are demonstrably solvent. I would demand to see the books before I negotiated with a team.

If this article is accurate, the ramifications are tremendous.

Do I hear Contraction rearing it's ugly head?

Do I hear Contraction rearing it's ugly head?

No.

The franchise still has plenty of value ($100MM plus) and there's no way MLB abandons that market.

I'm stunned on several levels.

Stunned that the debt situation could have gotten so bad.

Stunned that MLB hasn't stepped in and forced a sale or something before it got to this point.

And really stunned that the obligations to the players could be wiped off the books so quickly and easily, and that individual players might lose this kind of money at the stroke of a pen. Did agents and the union not see this possibility?

This is potentially HUGE. The individual contracts go to the heart of the relationship between the players and clubs. If I were an agent, I would advise my clients to sign only with teams that are demonstrably solvent. I would demand to see the books before I negotiated with a team.

If this article is accurate, the ramifications are tremendous.

This Wall Street Journal article says that the new owners are willing to assume the debt that is owed to A-Rod and Millwood.

Link: http://tinyurl.com/32ojmx2

In January, Mr. Hicks reached a deal with Messrs. Greenberg and Ryan to sell the Rangers, the Ballpark at Arlington, and some 150 acres adjacent to the stadium in a deal valued at about $530 million, although the value has escalated with the rising amount of liabilities the new owners are prepared to assume. According to court filings those liabilities include almost $25 million that the team owes slugger Alex Rodriguez in deferred compensation and almost $13 million it owes pitcher Kevin Millwood.

This is potentially HUGE. The individual contracts go to the heart of the relationship between the players and clubs. If I were an agent, I would advise my clients to sign only with teams that are demonstrably solvent. I would demand to see the books before I negotiated with a team.

I think we end up seeing bankruptcy becoming more of a reality for clubs especially in the mid and small markets. It's amazing how broken the economic model of Baseball is.

I'd have picked KC or Pittsburgh before the Rangers.

Amazed that they still owe money to Tettleton and McLemore.

This Wall Street Journal article says that the new owners are willing to assume the debt that is owed to A-Rod and Millwood.

This makes sense. I doubt that MLB would approve the sale otherwise.