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Cubs sale: the early days and a few thoughts on the deal (including a guest opinion from gaius marius)

In chicago cubs on July 6, 2009 at 2:49 pm

The sale of the Chicago Cubs has been a story that has went on much longer than most realize. Rumors that the old Tribune Company would deal the Cubs started in the Fall of 2005. By 2006 it became very clear that the Tribune wasn’t gonna continue to operate the way it had for years. The only question for Cubs fans was where would the Cubs end up when all of this was said and done.

Good friend gaius marius covered much of what went down in the Trib boardroom for 1060w during that time. He has been a consistent commenter on the sales process over here in the short time we’ve been around. I e-mailed gm and asked him for his thoughts on the agreement today. Here is what he said:

Its a big positive step – the last potential deal killer is the placement of remaining financing notes. I would not expect that to be easy, but it will likely get done at some price. Even if it doesn’t Ricketts could raise more cash to cover the difference – which would be preferable, as it would minimize the club’s considerable debt service obligation going forward.

Surprises may remain, but I think the biggest unknown was whether Ricketts was committed to making it happen. He could have killed this thing in the last few weeks, and had reason to. I would have. It appears he didn’t, though, and so I think its “Welcome to the majors, Mr. Ricketts.”

gm’s opinion is always well respected on this page. I thank him for taking time to answer this question.

my (ccd’s) opinion — Bottomline on all of this is this is a good day for the cubs as a franchise. They will get away from a corporation that has larger concerns than who should be playing 2b everyday at Clark and Addison. As things continue to deteriorate, mother tribune is going to sell off most of their properties over the next several years. The Cubs should be happy to get out early before things get uglier inside the tower.

As far as Ricketts as an owner goes, there will be changes. Anytime a business changes hands there will be changes. Because of the debt and the cost of the franchise some of these changes will be unpopular with the fanbase (myslef included). Ricketts is buying the club when the fans expectations have never been higher. Fans want to win now and if they don’t at some point Ricketts will go from being the popular new guy to being as unpopular as Chicago sports franchise owners before him.

The task at hand for Ricketts is not going to be particularly easy. Away from the field, the Cubs have several issues first and foremost is the future of Wrigley Field. Next the future of their radio and television broadcasts. Finally this team will have to find as many possible ways to maximize revenues associated with the Cubs brand and Wrigley Field.

I wish Tom Ricketts and his family the best of luck. The most important thing, and what will make Ricketts a beloved hero in this town will be winning the whole enchilada.

Cubs sale: Ricketts/Tribsters have an agreement?

In chicago cubs on July 6, 2009 at 9:34 am

This is from Chicago Tribune’s breaking news site:

Tribune Co. has reached a deal to sell the Chicago Cubs and Wrigley Field to the Ricketts family, a source familiar with matter said this morning.

The two sides finalized a sale agreement over the weekend and have forwarded the contract to Major League Baseball, the source said.

The deal must be approved by other baseball owners. With Tribune Co. operating under Chapter 11 bankruptcy, the sale also will need court approval.

The source said the sales price is “close” to the $900 million bid the Ricketts offered earlier this year that won an auction for the baseball team, stadium and a 25 percent stake in Comcast SportsNet Chicago, a regional cable television sports network.

More from Reuters:

The Ricketts family has reached a deal to buy the storied Chicago Cubs baseball team from bankrupt media company Tribune Co for slightly less than the original $900 million bid, a source familiar with the deal said on Monday.

“There is a deal between the Ricketts and Tribune Co,” said the source, who asked not to be identified because the agreement has not been announced.

Spokesmen for Ricketts and Tribune Co were not immediately available to comment.

The Ricketts family, led by Chicago investment banker Tom Ricketts, agreed in January to buy the team, its home park of Wrigley Field and a stake in a regional sports cable TV network for $900 million.

“The terms are very similar,” the source said. “It’s slightly less than that.”

A final deal had been held up by disagreements over the value of Cubs’ broadcast contracts and other items, as well as the Ricketts arranging their financing for the purchase.

UPDATE 1: WGN’s Dave Kaplan, who broke the story last week that the deal was about to be finalized between Ricketts and the Tribune, speculates on the type of owner Ricketts will be.

UPDATE 2: BizofBaseball.com’s Maury Brown tells us what the next step in the sales process is:

If the sale agreement is finalized, the next steps would be approval by MLB’s Executive Committee, followed by a vote by all 30 owners in the league. Club transfers require approval by 75 percent of the league’s owners. The transfer to Ricketts is expected to pass without conflict.

The next quarterly owners meeting is set for August. A vote could take place before then via conference call, if the league so desires.

Chuck at Ivy Chat has been covering the sales process before the rumblings out of the tower were even considered rumors. Here is a link to what he has to say. Chuck speculates on the final sale price:

I wonder how “close” they got? My guess is somewhere between the $850 million the Ricketts said the team was worth post-”discovery” of the TV contract issue and the $900 million that they originally agreed.

Crain’s Chicago Business chimes in:

The agreement reached over the weekend still needs approval from 75% of MLB team owners, as well as creditors and the Delaware judge overseeing Tribune’s Chapter 11 bankruptcy case.

UPDATE 3:Bloomberg has a statement from the Tribune:

“We continue an active dialogue with the Ricketts family with an eye toward reaching a definitive agreement,” Gary Weitman, a spokesman for Tribune, said in a statement. “We don’t intend to comment on the specifics of any potential transaction.” He declined to comment beyond the statement.

UPDATE 4: According to the Tribune’s Paul Sullivan the Cubs are silent on the agreement:

As for the sale of the team to the Ricketts family, the Cubs have suddenly dropped the cone of silence on Wrigley Field, with no one available for comment.

Ramirez returns tonite

In chicago cubs on July 6, 2009 at 7:21 am

Aramis Ramirez returns to the Cubs roster tonite against the Braves, as does Reed Johnson and Angel Guzman. The Cubs played awful with Ramirez out. But thanks to the fact that there really isn’t a good club in the NL Central they were able to ‘tread water’ with Ramirez out of the middle of their lineup.

Here were the NL Central Standings the night Aramis Ramirez went down in Milwaukee.

NL Central Division May 8, 2009
Tm W L PCT GB
STL 19 11 .633 –
MIL 17 13 .567 2.0
CIN 16 13 .552 2.5
CHC 16 13 .552 2.5
PIT 12 17 .414 6.5
HOU 12 17 .414 6.5

Here are the current NL Standings:

TM W L Pct GB
STL 45 39 .536 –
MIL 43 39 .524 1.0
CHC 40 39 .506 2.5
CIN 40 40 .500 3.0
HOU 39 41 .487 4.0
PIT 37 45 .451 7.0

So although the Cubs really struggled (24-26) with Aramis Ramirez out of the lineup they find themselves in the exact same position they were the night he went down, trailing the Cardinals by 2-1/2 games. The furthest the Cubs fell out of the race was 5.0 games on May 25th. Maybe this speaks to how bad the division is? I’m not really sure. What I do know is that if the Cubs can start to play better on the road, they can take a run at this division.

Of course with their next seven games at home leading up to the All Star break the Cubs won’t have to worry about their road blues for another week and a half. The Cubs will welcome Atlanta to the confines for three starting tonight and over the weekend the first place Cardinals come to town for 4 games in three days. That series takes on tremendous importance for the Cubs as they head to the break.