Bankruptcy Battle: McCourt & MLB (Round 1)
MLB Has Agreed To Let Frank Use His Financing Option…
We all learned yesterday that Frank McCourt (Dodgers) have filed for bankruptcy.Today is the initial hearing with the Judge deciding on financing, which is required to meet June 30th payroll.
- The team (Dodgers) is seeking permission to borrow $150 million in short-term financing at 10% interest rate and a $4.5M exit fee.
- MLB has offered to provide the financing needed at 7% interest rate and no fee.
- If McCourt uses the financing he wishes, it would likely leave him in charge while all of this drags on for months.
- If MLB wins, then they are most likely able to keep the monitor in control of the Dodgers and ultimately able to take over complete control.
- MLB has agreed to let McCourt use his financing.
- The exit fee has been change from 4.5M to 250,000.
- Media rights auction on hold. Will be decided in bankruptcy court.
- There is a scheduled hearing for July 20th, at which MLB can ask to replace McCourt’s financing.