In a victory for lenders in the Texas Rangers Chapter 11 bankruptcy case, a federal bankruptcy judge said that he would not approve the plan to sell the Texas Rangers unless it was modified. Lenders in the Texas Rangers bankruptcy case had argued for months that the proposed $575 million purchase deal by the Greenberg-Ryan group was significantly less than what others were willing to pay. They have been calling for a reopening of the bidding to give others an opportunity to purchase the baseball team in bankruptcy. However, the bankruptcy judge gave no indication that he was calling for the Texas Rangers to reopen the bidding and made it clear that the bid did not have to be highest to be the winning bid.
In his opinion, Judge Michael Lynn of the United States Bankruptcy Court for the Northern District of Texas in Fort Worth did not specify what changes the independent chief restructuring officer needed to make to the plan, or whether another auction had to be held. The judge also said that the team owners did not have to obtain the maximum possible value for the team.
But Lynn suggested that the owners and the restructuring officer must come up with a revised plan that is more palatable to the lenders, who he said were the only creditors harmed by the current plan.
Supporters of the Greenberg-Ryan purchase plan have made it clear that they do not intend to reopen the bidding and were in fact hoping that the purchase could have been completed by baseball’s opening day. However, at this point the modified plan could be approved by the end of July at best; but it must still be approved by Major League Baseball before they can move forward.