MLB Owners Approve Sale of Cubs to Ricketts

[The Dude]

<!--quoteo(post=67341:date=Oct 27 2009, 12:11 PM:name=rok)-->QUOTE (rok @ Oct 27 2009, 12:11 PM) <{POST_SNAPBACK}><!--quotec-->I need something to believe in. Might as well be Ricketts.<!--QuoteEnd--><!--QuoteEEnd-->

I'll bet those words have never been uttered before.

[netpox]

I need something to believe in. Might as well be Ricketts. Well said rok

[rok]

Very interesting stuff on the team's debt structure, which should provide a stable outlook for more than a decade. Hopefully if they do hire a new CFO, it would mean that Kenney's days with the team are coming to an end. Also, there is a blurb about ballpark naming rights which reveals that the Wrigley family could block a deal or remove its name should they not agree with a particular corporate sponsor.

http://www.chicagobusiness.com/cgi-bin/art...articleId=32855

<!--quoteo-->QUOTE <!--quotec-->After closing on the deal in October with $674 million in debt, Mr. Ricketts and his financial advisers brought in institutional investors — such as insurance companies, pension funds and banks — to refinance $250 million in short-term debt provided by three banks, according to a Ricketts family spokesman.<!--QuoteEnd--><!--QuoteEEnd-->

<!--quoteo-->QUOTE <!--quotec-->The Ricketts' spokesman says that converting the term loans into private placement notes with longer maturities provides "flexibility" for the family, and he insists that despite the heavy debt load, the team won't cut payroll. Mr. Ricketts also has said that in the near future he plans to plow any profits back into the club.

<b>The team, now interviewing candidates for the new position of chief financial officer, still intends to raise additional money, upward of $100 million, by selling "investor notes" to wealthy individuals, the spokesman says. That money would go to pay for capital projects, he says.
</b>
While the use of private placement debt in a sports franchise deal is novel, Mr. Zimbalist and other experts say the high-profile nature of the Cubs and the team's strong following probably bolstered the sale and helped lower borrowing costs for Mr. Ricketts.

"This is A-grade paper," says Andrew Kline, founder and managing director of Los Angeles-based Park Lane, a sports investment banking firm that wasn't involved in the deal. "The strong tradition and stable financial standing of the Cubs made this a legitimate investment opportunity even for institutional investors and insurance companies that would not conventionally consider lending capital to a professional sports franchise."<!--QuoteEnd--><!--QuoteEEnd-->