I got to wondering how Hicks — or Hicks Sports Group, whatever — who recently had to borrow money from MLB to make Rangers payroll, managed to retire his portion of the nearly $100 million in debt that made possible the refinancing of his $478 million Liverpool loan. I posed the question to a FrontBurnervian who isn’t afraid to theorize. He guesses:
I think that what happened with Hicks’ involvement with his Dallas teams was driven by the realities of his Liverpool co-ownership. Within the Premier League and Football Association, the members share mainly contract TV revenue from Sky B but are otherwise economic free agents in regard to the conduct of team finances. In short, there are no built-in safety nets — as available both through the MLB and/or NHL (although less so) — in terms of available emergency financing from the Premier League or league structural provisions that would pose a bar to foreclosure proceedings by lenders.
In his scramble to raise money for required debt retirement as a condition to rollover the Royal Bank of Scotland facility for Liverpool, Hicks knew that he could rely upon the collective support of the MLB and NHL. And as he had no structural supports available in Britain, it was more palatable for Hicks to default on his stateside obligations — which effectively, due to league and franchise rules, gave him a built-in stay of execution — than to face foreclosure as effected by Royal Bank of Scotland in Britain (where Hicks would have no ability to control his destiny in regard to the disposition of his Liverpool stake).
