Cubs reportedly to file for Chapter 11
CHICAGO -- The Chicago Cubs might file for Chapter 11 in order to speed their sale by bankrupt media company Tribune Co., according to several media reports.
Reuters first reported the story Monday, citing sources familiar with the process. If they file, the Cubs would become the first team to declare bankruptcy since the Seattle Pilots went belly-up in 1970.
"It's pretty certain that they will do it," a source, who asked not to be identified because the sales process is continuing, told Reuters.
Tribune Co., which itself filed for bankruptcy protection in December, intends for the Cubs' own stay in Chapter 11 to last just a day or two. The Cubs were not part of Tribune's December filing.
Such an approach would likely be taken to ensure the storied baseball team and related assets are free of liabilities so as to speed a sale, a Reuters source said.
"I assume it will be a quick in and out," the first source said, adding the team could emerge from bankruptcy in anywhere from weeks to days.
Tribune Co. spokesman Gary Weitman declined to comment.
The company has reached an agreement to sell the Cubs, their home park of Wrigley Field and a stake in a regional sports cable network for slightly less than $900 million to the Ricketts family, Reuters previously reported. However, the company also remains in talks with a second group led by private equity investor Marc Utay, sources have said.
Weitman reiterated on Monday that Tribune has not reached a deal with any group.
A third source familiar with the sales process said Bank of America Corp., Citigroup Inc. and JPMorgan Chase & Co. -- the banks involved in the bid by Tom Ricketts, CEO of Chicago investment bank Incapital LLC and son of the founder of TD Ameritrade Holding Corp. -- have begun calling to syndicate that group's loan.
Tribune Co. filed for bankruptcy in December due to its heavy debt load and the weak U.S. publishing sector. It put the Cubs, Wrigley Field and a 25 percent stake in a local sports TV network on the block in April 2007, when Tribune agreed to an $8.2 billion buyout led by real estate magnate Sam Zell.
Buyers are eager to take control of the National League team, which despite not winning a World Series title since 1908 has a huge fan base helped by its "lovable losers" image and national exposure on cable TV.
Information from Reuters was used in this report.