In Re Texas Rangers Baseball Partners

431 B.R. 706 (2010)

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Nature of the Case

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Facts

Baseball (P) was owned by a partnership. P was had to be sold because of financial difficulties. The owners agreed to sell to Express. P and Express entered into an asset purchase agreement (APA). The equity partners hired William Synder who was appointed to oversee the conduct of the equity partners. Hicks was the dominant member of the equity partnership but Hicks owed money to a group of lenders and as part of those loans, they had a contractual right to approve any sale. Hicks’ lenders objected to the sale. Following his appointment, Snyder made contact with several potential bidders. Snyder negotiated with Express, P, and other parties, seeking to agree on bidding procedures to market-test the APA. P filed a motion seeking approval with the support of Snyder but Snyder changed his mind as the procedures were not workable. On July 12, 2010, Express commenced an adversary proceeding against P seeking to enforce certain provisions of the APA. P had filed under chapter 11 in order to cramdown the sale to express over objection by Hicks’ lenders. The plan gave Express a breakup fee of 2 percent of the purchase price if another bidder won the auction. P proposed yet another similar set of bidding procedures. The court held a hearing on July 13, 2010. Following argument by the parties, the court announced that it would adopt its procedures with certain further modifications. It directed the Rangers Equity Owners to make modifications to the existing draft and invited parties to comment by the afternoon of July 14 on the result. Following receipt of the revised draft and review of comments received, the court completed its formulation of procedures, in the form of the Approved Procedures, which it then implemented by the Procedures Order. The Lenders then filed this Motion for reconsideration. The Lenders and Snyder argue that the time allowed other bidders under the Approved Procedures is inadequate for completion of due diligence and for competing bidders to obtain financing. They contend that the stalking horse protections afforded Express are unnecessary and overly generous.