More than a decade ago, billionaire Mark Cuban looked poised to seize control of the Texas Rangers — but the Dallas Mavericks owner and “Shark Tank” star lost a bidding war in the 11th hour.
Now, after years of silence, insiders have revealed behind-the-scenes maneuvering that resulted in reclusive energy tycoon Ray Davis’ surprise agreement to buy the 2023 World Series champions — and a deal kept under wraps with Fox Sports was key to the outcome, according to sources.
In the summer of 2010, Cuban had partnered with Houston shipping magnate Jim Crane — not yet the controversial owner of the Houston Astros — to buy the Texas Rangers, and they were the favorites to win a court auction.
A year earlier in April 2009, buyout baron Tom Hicks’ Hicks Sports group had defaulted on its debt and its Rangers franchise, which it had acquired 11 years earlier, filed for bankruptcy.
Meanwhile, however, Chuck Greenberg, who headed the sports practice at law firm Pepper Hamilton, put together 12 investors to buy the team — including Davis and the team’s then-president, legendary hurler Nolan Ryan.
In May 2010, Greenberg’s group had reached a $500 million prepackaged bankruptcy deal for the Rangers that was bolstered with an additional $75 million for the stadium parking lot that would have gone straight into Hicks’ pocket.
But Hicks Sports Group creditors rejected the deal, believing an auction with Cuban as a rumored bidder would fetch more.
Indeed, Cuban was worth $2.4 billion at the time.
Crane three years earlier had lost his company EGL to Apollo Global Management in a hostile takeover, but had pocketed more than $300 million from the sale.
He was also a former University of Central Missouri star pitcher and loved baseball.
An added plot twist came as talks heated up during the summer of 2010, with Cuban approaching Greenberg to join his bidding bloc.
The pair had a history: In 1999, Greenberg had pitched Cuban to lead a bid for the Pittsburgh Penguins with Penguins legend Mario Lemieux.
Cuban declined and Greenberg ultimately helped Lemieux acquire the NHL franchise.
More than a decade later as the Rangers bidding war was heating up, “Mark asked me to dump my partners and team with him,” Greenberg told The Post in an exclusive interview last week.
Nevertheless, Greenberg said he preferred to be loyal to his agreement with Davis, who by that time had proven to be a reliable partner who was committed to the purchase.
Cuban, meanwhile, told The Post he doesn’t remember the details about his conversations with Greenberg about the Rangers.
Twice before Cuban had worked on deals to buy the Rangers but walked away because he didn’t want to take on some of the team’s liabilities, the Wall Street Journal reported at the time.
A year earlier, Cuban also had bid aggressively in a losing effort to acquire the Chicago Cubs.
Facing a fierce bidding war against Cuban and Crane, Greenberg said he went looking for — and found — another key source of cash: Fox Sports.
Specifically, Greenberg worked out a 20-year extension with Fox Sports, which had been carrying local Rangers games for years, he told The Post.
“In the days leading up to the auction I secretly negotiated a deal with Fox,” Greenberg said. “We worked out a deal because they didn’t want Mark Cuban.”
According to Greenberg, Fox had recently lost the rights to broadcast local games for the Houston Astros and the Houston Rockets — a development that hadn’t yet become public. (Two years later in October 2012, Comcast SportsNet Houston launched and Fox Sports Houston was shut down.)
The big worry, according to Greenberg, was that if Cuban bought the Rangers, he could form a regional sports network combining the Rangers with the Mavericks potentially pushing Fox Sports out of the Texas market altogether. (Indeed, shortly after the auction Cuban told the Journal he had not only considered forming such a network, but also was looking to increase the price Fox Sports would pay for broadcast rights.)
Accordingly, Greenberg cut a deal with Fox in which, if his bidding bloc prevailed in the auction, Fox would increase its payments to broadcast Rangers games from $70 million a year to roughly $100 million a year — and pay several hundred million dollars in advance.
“We had a unique alignment of the stars,” Greenberg said. “The deal was not signed but we had an agreement. The difference maker in our bid was we negotiated a price with Fox and a significant chunk of the money was up front.”
A spokesperson for Fox Spots, which shares a common owner with News Corp, the publisher of the New York Post, declined to comment.
The Shark Tank host didn’t know about the Fox deal.
On Aug. 4, 2010, the auction in US Bankruptcy Court in Fort Worth saw the two bidding teams going head-to-head to top Greenberg’s bankruptcy offer, which had included about $270 million for creditors in cash and $230 million in newly issued loans.
Cuban’s group came out swinging.
After the judge asked each party if they could bid $2 million more, Greenberg’s group obliged.
Cuban’s group, meanwhile, bid $25 million more in cash for creditors and matching the rest, according to reports,
Several more rounds passed, with Cuban boldly clearing the bidding hurdles while Greenberg’s camp bid just enough to stay alive.
“We went into the auction with a lot of dry powder. We played possum the day of the auction,” Greenberg said. “It looked like Mark and Jim Crane were kicking our butts. Everyone thought we were weak.”
“No one knew we had this financial behemoth behind us,” Greenberg added, referring to Fox Sports.
As the auction dragged into late evening, Cuban reportedly ordered 10 pizzas to be delivered to the courthouse for his lawyers and advisors.
Davis, meanwhile, sat in the back and was very quiet, a source who was present at the proceedings said.
“Ray was a very hard-nosed businessman.
He had been a CEO for hire for several companies,” Greenberg said, referring in part to Energy Transfer LP which now has 125,000 miles of pipeline spanning 41 states transporting natural gas and oil.
“Davis made his wealth relatively late in life,” Greenberg added. “He struck me as very self-confident.”
Around midnight, after 15 hours of back and forth, Greenberg dropped a bomb — raising his bid to $593 million and topping Cuban’s latest offer by $15 million.
Cuban and Crane conceded.
“We went with this shock-and-awe bid and then saw the looks on the faces of our opponents and they clearly did not see it coming,” Greenberg said. “They thought they had us on the ropes and we came off the ropes and knocked them out.”
Creditors had clearly made the right decision to force an auction, pocketing an extra $120 million in cash in the $593 million deal.
Just seven months later, Greenberg resigned as MLB’s control person for the team, turning it over to Davis, who has never owned a majority but has remained the largest in the team’s group of owners.
The Rangers since have more than tripled in value — worth $2.2 billion, based on the most recent Forbes valuation.
Last week, Davis made a rare public appearance as he accepted the World Series trophy at Globe Life Field on behalf of the Rangers for their first-ever championship in the 63-year history of the franchise.
Greenberg, who sold his stake less than a year after the acquisition, said he hasn’t been in contact with Davis for years.
He was at one of this year’s Rangers playoff games but skipped both the World Series home games due to prior family commitments.
Greenberg presently owns the Frisco Roughriders, a Texas Rangers double-A minor league team; the Myrtle Beach Pelicans, a Chicago Cubs single-A affiliate; and the State College Spikes.
Meanwhile, Cuban — who before and after the Rangers auction had made failed runs for the Pittsburgh Pirates and Los Angeles Dodgers, respectively — admitted years ago to being stunned at his loss in the Fort Worth courtroom.
“I have to honestly tell you there were more than a few times I thought we had the thing won,” Cuban had told the Wall Street Journal immediately after the fateful auction.
In an interview with The Post, however, Cuban was inclined to be a good sport — and said he is glad that Greenberg and Davis won in the end.
“They brought a World Series to the Rangers,” he said. “They deserve a ton of credit.”
This story originally appeared on NYPost
