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Broadcast Contracts Hinder Cubbies Sale

CHICAGO: The media access that made the Cubbies national loveable losers is also holding up the sale, according to the Chicago Tribune. TD Ameritrade heir Thomas Ricketts’ family emerged in January as the winner of the Windy City’s Major League Baseball team with a $900 million bid, but has since decided that the broadcasting contracts rolled in with the team were overvalued. The Trib is reporting that Ricketts family is looking to knock $40 million to $50 million off the original bid.

The cubbies are part of the Tribune empire, including the newspaper, CW affiliate and superstation WGN-TV, WGN radio and Comcast SportsNet Chicago. Home games have been televised on WGN for 51 years and broadcast on the radio station even longer. The SportsNet cable channel was co-launched with other local pro teams five years ago to tap into the platform’s subscriber fee-based revenue model. Tribune is selling its 25 percent piece of SportsNet along with the Cubbies and their 95-year-old ballpark, Wrigley Field, to help pay down the $13 billion debt incurred in part by Sam Zell’s $8.2 billion takeover, which precipitated Tribune’s bankruptcy.

The broadcast outlets and the Cubs split ad revenues 50-50, an arrangement favoring the broadcast side, the Trib said. The Ricketts family wants the most revenue possible for the team, while Tribune must max out the value of its own contracts while it reorganizes under Chapter 11. The dichotomy encompasses the Ricketts’ family backers, J.P. Morgan Chase, Citigroup and Bank of America, contributing $350 million to the deal, the Chicago Sun-Times said. Those self-same banks are among Tribune’s many creditors. -- Deborah D. McAdams