Even billionaires who have seen their net worth battered by the Wall Street downturn still salivate at the possibility of owning a Major League Baseball franchise. At least three wannabe team owners have stepped up to the plate in the second round of bidding to acquire the Chicago Cubs from the Tribune Company, which is trying to cut its massive debt load.
The company’s flagship Chicago Tribune, which has been following the bidding very closely, reported that bids were submitted by Chicago real estate investor Hersch Klaff; the Ricketts family, founder of online brokerage TD Ameritrade Holding Corp.; and a group led by Marc Utay, a New York private equity investor. It is not known, though, whether Dallas Mavericks owner Mark Cuban and Houston Businessman Jim Crane also stayed in for the second round. Cuban’s prospects for winning approval from other MLB owners diminished last month when he was accused of insider trading by the SEC.
What’s also not known is whether any of those 2nd round bids came anywhere near the $1 billion range that was expected many months ago when Tribune CEO Sam Zell began shopping the team. In addition to the Cubs, the package up for sale includes Wrigley Field and 25% of the regional Comcast SportsNet.
To avoid owing any immediate capital gains tax, Tribune had been expected to hold onto a 5% stake when the team is sold – a maneuver that Zell has used in other divestitures since taking Tribune private last year and loading the company up with $13 billion in debt. There has been speculation that Tribune may be forced to hold onto a larger stake this time in order to get a deal done at an attractive price.
