AP sources: Cubs exploring bankruptcy filing

[July 14, 2009]  CHICAGO (AP) -- The corporate owner of the Chicago Cubs is considering having the baseball team file for bankruptcy protection as a legal step to hasten its long-awaited sale, according to two people with knowledge of the process.

Tribune Co., which itself filed for bankruptcy protection in December, intends for the Cubs' own stay in Chapter 11 to be as short as a day or two. If pursued, the filing would be done to give the team's next owners as "clean" a title to the Cubs as possible -- to protect them from possible future claims by Tribune creditors.

The people familiar with the process described it to The Associated Press on Monday, confirming earlier reports. These people spoke on condition of anonymity because the bankruptcy plans are not yet public.

One person said the filing is not imminent and is not necessary in order for a sale of the Cubs to take place.

A possible bankruptcy filing is just the latest twist in the lengthy sale saga involving a prosperous but star-crossed franchise that hasn't won the World Series since 1908.

Tribune, which bought the Cubs from Wm. Wrigley Jr. Co. for $20.5 million in 1981, put the team on the market on opening day 2007, when real estate mogul Sam Zell agreed to buy the media conglomerate. But Zell has proceeded deliberately in selling off one of the company's most lucrative assets, which were not covered by the Tribune Co. bankruptcy filing in December. The recession and credit crisis have slowed the sale further.

The family of TD Ameritrade founder Joe Ricketts remains the front-runner to buy the team for about $900 million, but there is no final agreement. The family and Tribune Co. are still ironing out details.

Cubs Chairman Crane Kenney did not immediately respond to a request for comment.

Bankruptcy attorneys said the Cubs should be able to get in and out of bankruptcy court quickly, citing the General Motors Corp. case among others without major underlying disputes.

"They're not looking for protection from creditors who are banging on the door," said Paul Rubin, a corporate bankruptcy attorney in New York who is familiar with sports bankruptcy issues. "They're looking to cleanse the entity so the buyer is protected on the back end."

Peter Russin, a bankruptcy lawyer in Miami, said filing in court now that a deal appears close makes sense because it can help resolve any remaining roadblocks to the sale.

It's not clear what issues might be holding up a final agreement on a sale package that includes the Cubs, Wrigley Field and a 25 percent interest in a regional sports network.

Asked about the possible bankruptcy filing Monday, Major League Baseball Commissioner Bud Selig said he's been "talking to people" but "I can't tell you there's anything new."

"The Tribune Co. is handling it and it's in their hands until they come to us, and they have not come to us," Selig said. "It's a situation that they're handling right now, and until baseball's involved there's nothing more for me to say."

[Associated Press; By DAVE CARPENTER]

AP Baseball Writer Ronald Blum contributed to this report.

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