Suburban bleacherite’s offer around $900 million
January 23, 2009
BY DAVID ROEDER email@example.com
Tribune Co. has anointed a favored bidder for the Cubs and has forwarded the offer to the bankrupt media company’s creditors, sources said Thursday.
Two people familiar with the process said the endorsed bid was from Thomas Ricketts, chairman of corporate bond dealer Incapital LLC. He is the son of Joseph Ricketts, founder of the TD Ameritrade discount brokerage.
The Ricketts family confirmed the news Thursday night in a statement that said it’s looking forward to working with Tribune and Major League Baseball to close the deal promptly. The Ricketts bid was one of three proposals for the Cubs that Tribune evaluated at length after weeding out several others.
Ricketts is believed to have offered about $900 million. The Cubs, without a World Series crown in 100 years, are among the most valuable franchises in baseball because of their strong attendance and national TV following.
Other bidders are Chicago real-estate investor Hersh Klaff and a New York tandem of private investors Marc Utay and Leo Hindery Jr.
”They want Ricketts, and it’s always been Ricketts,” a source said.
While the others might have bid a higher price for the team, sources said the Ricketts offer had more conservative financing, an important factor when credit is extremely tight.
Also, Ricketts lives in the Chicago suburbs and represents what is essentially a family bid. Baseball owners, 75 percent of whom must approve any sale, are known to favor tight-knit groups of owners with local ties.
Ricketts may have gained an inside edge by hiring the law firm Foley & Lardner to assist him in the ownership quest. A Foley partner is Robert DuPuy, president of Major League Baseball.
A prime source of the family’s wealth is its ownership of about 22 percent of the stock in TD Ameritrade Holding Corp. The stake is worth about $1.5 billion.
Tribune is selling the Cubs to chip away at debt its chairman, Sam Zell, accumulated last year to take over the company. It declared bankruptcy last month as extraordinary declines in advertising battered its business and forced it to press creditors for new terms.
The company apparently showed creditors the favored bid as a courtesy. The creditors can fight over the proceeds but lack authority to reject the bid. The Cubs franchise was not covered by the bankruptcy filing.
Tribune is not locked into negotiating with only one bidder. Others remain free to enrich their offers.
Cubs chairman Crane Kenney has said he hopes the team can be sold by spring training.