Financial Pressure Mounts For Hicks
The owner of the Rangers and the Stars will have until August 2010 to satisfy debts.
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The recent national economic woes have seemingly reached everyone, and Tom Hicks, owner of the Stars and the Rangers, is no exception.
Pressure has been mounting on Hicks since his holding company, the Hicks Sports Group, defaulted on a $10 million interest payment in late March stemming from $525 million worth of loans tied into the Stars and the Rangers organizations. Hicks announced that he would look to sell a majority interest in the Rangers in May, but as of yet, no one has stepped forward as a buyer.
Partly as a result of this seeming lack in interest in the Rangers, which is ranked by Forbes as the 15th most valuable franchise in baseball with an estimated net worth of $405 million, creditors are now looking to the Stars.
It was initially thought that Hicks would have until October 1st of this year to satisfy his debts. However, due to an agreement between the NHL and lenders, which states that if a default occurs within six months of the opening of the season, the borrowers will have the length of the season plus sixty days to make good, meaning that HSG will actually have until August of 2010.
If the Hicks Sports Group fails to satisfy the debt by this time, however, a takeover of some sort would become a possibility.
The good news, for Dallas fans, is that a move is highly unlikely at this point. The Stars are the gem of the NHL's southern market, and the sixth most valuable franchise in the league at an estimated $273 million.
According to an unnamed source in today's Dallas Morning News, Hicks plans on selling the Rangers while maintaining a minor share of the team, and full ownership of the Stars.
It was reported in July that Hicks received $15 million from Major League Baseball, though it is unclear whether this was a loan or merely an advance of money owed the team at the end of the 2009 season.
Liverpool F.C. of the English Premiere League, which is owned by Hicks and former Montreal Canadiens owner George Gillett, reportedly posted losses of around $69 million last year, according to the Dallas Morning News.
These latest troubles are somewhat reminiscent of Hicks' involvement in the Brazilian club team Sports Club Corinthians Paulista, which he bought in partnership with his former company Hicks, Muse, Tate & Furst in 1999. Financial troubles and infighting led to Hicks leaving the group and the club's eventual sale, at which time the team was in a shambles.
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