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Tom Hicks

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For other people named Thomas Hicks, see Thomas Hicks (disambiguation).
Tom Hicks
Born
Thomas Ollis Hicks, Sr.

1946 (age 77–78)
Dallas, Texas
NationalityAmerican
Known forHicks, Muse, Tate & Furst
Sports investment and management

Thomas Ollis Hicks, Sr. (born in 1946), is an American businessman living in Dallas, Texas. According to Forbes Magazine 2009, Hicks has an estimated wealth of USD 1 billion. Hicks co-founded the investment firm, Hicks, Muse, Tate & Furst, and is chairman of Hicks Holdings LLC, which owns and operates Hicks Sports Group, the company that formerly owned the Texas Rangers, currently owns the Dallas Stars, Mesquite Championship Rodeo and also owns fifty percent of the English football club Liverpool FC.

Biography

The son of a Texas radio station owner John Hicks, Hicks was born in Dallas, Texas. He graduated from Thomas Jefferson High School,[1] in Port Arthur, Texas, in 1964. Hicks is a brother of Sigma Phi Epsilon,[2] received his Bachelor's degree in Finance from the University of Texas in 1968, and received his MBA from the University of Southern California in 1970.[3]

Hicks became interested in leveraged buyouts as a member of First National Bank of Austin's venture capital group. Hicks and Robert Haas formed Hicks & Haas in 1984. The next year that firm bought Hicks Communications, a radio outfit run by Hicks' brother Steven – the first of several media companies bought or created by the buyout firm that involved Steven (Capstar, Chancellor, and AMFM).

Hicks & Haas' in the mid-1980s bought several soft drink makers, including Dr Pepper and 7 Up. The firm took Dr Pepper/7 Up public just 18 months after merging the two companies. In all, Hicks & Haas turned $88 million of investor funding into $1.3 billion. The pair went their separate ways in May 1989.[4] Hicks wanted to raise large pools to invest, while Haas preferred to work with investors deal by deal.[5]

In 1989, Hicks co-founded the investment firm, Hicks, Muse, Tate & Furst with former Prudential Securities banker John Muse. The firm raised $250 million, with early investments including a life insurance company, Life Partners Group (bought in 1990 and sold in 1996). In 1991, Morgan Stanley's Charles Tate and First Boston's Jack Furst became partners. Hicks was chairman from 1989 to 2004, Hicks Muse raised $12 billion of private equity funds, consummated over $50 billion of leveraged acquisitions, and grew to become one of the largest private investment firms in the country.[6]

But Hicks Muse hit a rough patch by the early 2000s, when investors in Equity Fund IV were burned by a $1.2 billion plunge into telecom investments in 1999. Hicks announced that he would leave the Hicks Muse on March 8, 2004, to spend more time with his family and his sports teams. (Hicks Muse was subsequently renamed HM Capital Partners.)

However, Hicks has remained active in his own ventures. He created Hicks Holdings, a vehicle for his billion-dollar sports and real estate empire, and then started buying companies again in the $10 to $250 million level, including:[7] a Chinese electronics firm, a venture with DirecTV selling bundled TV-telecom services to condos, a landscaping materials company in the Midwest, a pet food firm in Argentina, and Gammaloy – an oil field rental outfit he bought from his wife's family, paying approximately $20 million in the 1990s.

Additionally, he formed Hicks Acquisition Company I, Inc. (HACI). In September 2009, HACI merged into Resolute Energy Corporation (REN), an oil and gas firm.[8] Hicks is not on REN's board of directors, but his son, Thomas O. Hicks, Jr., represents HACI on the board.

As of 13th August 2010, the website for Hicks Sports Group appears to have disappeared, as for other websites for Hicks companies, whilst they are still operating, they appear to be empty of any data[9] and Hicks Sports Marketing now appears to be a Word Press blog site, with the first page advertising Online Gaming[10]

Politics

Hicks was recently a member of the political action committee for the 2008 presidential election campaign for former Republican Mayor of New York City, Rudy Giuliani.[11]

Tom Hicks Elementary School

Tom Hicks Elementary School in Frisco, Texas, part of the Lewisville Independent School District, was given its name after Hicks donated the necessary land for the school.[12]

Sports

Hicks moved from the business pages to the sports section in December 1995 when he bought the National Hockey League Dallas Stars for $82 million.[13]

Corinthians

In 1999, Hicks, Muse, Tate & Furst entered into a partnership with Sport Club Corinthians Paulista, a successful Brazilian club team. Club directors and Hicks, Muse, Tate & Furst assured the fans that a new stadium was in development, but this never materialized. After legal/financial troubles and partner infighting, Hicks retired from the company and the ownership group eventually left the partnership with Corinthians.

  • There was the initial blaze of publicity and fanfare when the company bought the club in 1999, with promises of big spending on the best players and the construction of a brand new 45,000 seater stadium in the suburbs of Sao Paulo.
  • There was an initial capital investment to tie down existing players and to finance the purchase one or two other additional players.
  • The economics behind the Corinthians deal appeared to be based on ridiculously rudimentary logic: "If you add up all the fans of professional baseball, basketball, football and hockey in the United States, that number is lower than the number of Brazilians who are soccer fans." Clearly, no proper risk analysis had been undertaken - a situation which resonates with the due diligence period of 3 days prior to the purchase of Liverpool.
  • This flimsy approach was reinforced by the apparently rash and impulsive purchase of Cruzeiro six months later - traits which Liverpool fans are rapidly coming to associate with Hicks.
  • There was also the emphasis on the cheaper "young players", with the following quote from the (unfortunately named) Richard Law, president of Hicks' subsidiary group: "Our job is not to turn back the inevitable, but to build Corinthians and Cruzeiro up from the junior ranks." Hicks followed a similar tack following the takeover of Liverpool: "You need to keep your star players but also develop your young players. Young players are the lifeblood of your team, so we talked about how we can improve that side of the team."

Corinthians had already won the Brazilian championship in 1998 so Hicks inherited a winning team. The initial expenditure assisted in retaining the league title in Dec 1999 and the club also won the inaugural FIFA Club World Championship the following month.

This is where things started to go wrong.

Unable to resist the temptation to make a quick buck, HICKS BEGAN SELLING TRANSFER RIGHTS TO THE CLUB'S STAR PLAYERS. On top of that, he decided on the bizarre idea of changing the traditional colour of the club's shirt. He also introduced sponsorship (something which Corinthians fans felt defiled their heritage).

All of these things led to a furious reaction from supporters and widespread protest against Hicks and his partners. The company bailed out three years later, ironically having accused its local partner in Brazil of "misappropriating funds" (read the UTIMCO post and you'll understand).

Corinthians began to spiral downwards. MSI took over the club's management but, despite a league title in 2005, the financial problems initiated by Hicks proved too much of a burden. The club was relegated to the second tier of Brazilian football for the first time in its history in December 2007.

THERE WAS NO NEW STADIUM. Hicks invested about five hundred million dollars and within two years filed for bankruptcy. [14] mini4me 02:51, 25 September 2010 (UTC)

Dallas Stars

Seven Division Championships, two Western Conference crowns, two Presidents' Trophies as the team with the best regular season record, two consecutive trips to the Stanley Cup Finals and the 1999 Stanley Cup Championship are the highlights of the Dallas Stars' rapid ascent in the 13 years since Thomas O. Hicks contracted to purchase the hockey club in December 1995. Mr. Hicks serves as the Stars' Chairman of the Board and the club's representative on the NHL Board of Governors, and also played an instrumental role in the development and planning of American Airlines Center.[3]

Texas Rangers

In June 1998, Hicks became the Chairman and Owner of the Texas Rangers Baseball Club of the Major League Baseball’s American League. Under Hicks ownership, the Rangers won the American League West Division crown in 1998 and 1999, but failed to deliver a World Series. Hicks made headlines across all MLB when he signed then shortstop Alex Rodriguez to the biggest contract in MLB. The ten year deal would have paid Rodriguez up to two hundred fifty two million dollars and guaranteed he would remain the highest paid shortstop in the game.[15] The Rangers also spent a large amount of money on another Scott Boras client Chan Ho Park, who signed a 65 million dollar contract with the Rangers following the 2001 season. The Park signing would be a disaster for the Rangers as the new ‘staff ace’ was unable to pitch away from the pitcher-friendly Dodgers stadium and in the hitter friendly American League. After finishing in last place for the division four seasons in a row Hicks agreed to trade Rodriguez to the New York Yankees. As part of the agreement the Rangers would supplement a portion of his remaining contract. This agreement would continue until Rodriguez opted out of his contract in 2007. Hicks’ ownership would see only 3 winning seasons in 11 full seasons of ownership.

On January 23 it was announced Hicks had agreed to sell the Rangers to a group led by Chuck Greenberg and Nolan Ryan. Hicks will be a minority share holder in the new ownership group.[16]

Prior to bids being placed by potential buyers, Hicks told the media the Rangers here operating under normal business with no interference from MLB. Regarding the Rangers' inability to sign 2010 first round pick Matt Purke, he said, "We were disappointed that the family insisted on $6 million. The Texas Rangers were not willing to do that. It had nothing to do with MLB restrictions. There is a clear misimpression we didn't sign Matt Purke because MLB wouldn't let us. That's not true. We didn't because of Tom Hicks, Nolan Ryan and Jon Daniels. We were not willing to go to $6 million."[17] After his group had completed the purchase agreement, Nolan Ryan told the media the Rangers were not able to offer the 1st round pick the 6 million dollar signing bonus both parties had agreed to verbally after the draft because MLB, who were strictly overseeing the Rangers budget by this time, wouldn't approve the amount needed to sign Purke.[18]

After the announcement of the pending sale by Hicks Sports Group, several additional hurdles have occurred which would have to be remedied before the sale of the team can be finalized. Several of the lenders, who are owed over $500 million, have vocally objected to the deal accusing Hicks of rejecting a higher offer by Jim Crane and have stated they would not sign off on the deal.[19] Also, Hicks has been sued by 3 different parties over the land adjacent to the stadium that was sold in a separate transaction as a part of the purchase by Greenberg and Ryan.[20][21]

On May 24 Hicks and HSG filed for Chapter 11 bankruptcy protection/separation of the Texas Rangers from HSG and asked the courts to approve of the sale of the Rangers to the group headed by Chuck Greenberg and Nolan Ryan. The move was made to expedite the sale and resolve the sale prior to the MLB trade deadline and draft signing deadline.[22]

Emails presented in court show that after Hicks agreed to an exclusive negotiation period with Greenberg attorneys for HSG were still in discussion with another bidder, Dennis Crane, about a sale price for the team and emailed the creditors on December 31, 2009 saying "Basically, the response from the MLB was to prohibit us from negotiating with anyone other than Greenberg. Their intent seems to be to lock us into Greenberg even though Crane now has a clearly superior economic deal -- and may always have had based on Greenberg's current position. We need help here. Unless the lenders weigh in, we are going to be stuck negotiating a deal that is clearly worse than Crane's."[23][24]

Liverpool F.C.

Main article: History of Liverpool F.C.

On February 1, 2007, it was made known through the English press that he was involved in a consortium with one-time friend and Montreal Canadiens owner George N. Gillett Jr. to purchase English Premiership club Liverpool F.C; this takeover proposal was believed to be the front runner after Dubai International Capital withdrew their bid.[25] On February 6, 2007, Hicks & Gillett's joint offer for Liverpool was formally accepted, valuing the club at £218.9m ($432.9m) (£5,000 per share and £44.8m in debt).[26] Liverpool became the third FA Premier League club to be acquired by U.S. businessmen, the others being Aston Villa and Manchester United. After the bid was accepted, Hicks stated his foremost priority was gaining silverware, and vowed to build a new stadium for the club at Stanley Park Stadium. The plans to build the stadium were edited and currently the stadium is not being built.

Hicks has become a hate figure amongst Liverpool fans for his failure to deliver the promise of a new stadium and no debt to be placed onto the club. Furthermore a public spat with former manager Rafa Benitez and an attack in former chief executive Rick Parry in an interview with Sky Sports News just 24 hours after the 19th anniversary of the Hillsborough disaster enraged fans as disrespectful and totally oblivious of traditions at the club he part owns.

On January 22, 2008 a majority of Liverpool fans, at the game between Liverpool and Aston Villa, protested against Gillett and Hicks' running of the club, urging the pair to sell their shares in Liverpool FC to DIC. Neither owner, nor their representative Foster Gillett were present at the game. Gillett has reportedly been targeted by DIC to sell his shares. It has been reported that he has fallen out with Tom Hicks and in recent months has kept silent over his dealing with the club.[27] On March 7, 2008, it was reported that Gillett had agreed to sell 98 per cent of his Liverpool stock to DIC,[28] but Hicks blocked the sale.[29] In an interview on Prime Time Sports in Canada, Gillett revealed that he and his family had received death threats from angry Liverpool fans: The fans don’t want him (Tom Hicks) to have even one share of my stake in the club, based on what they are sending to me. As a result of that we [my family] have received many phone calls in the middle of the night threatening our lives, death threats. A number came to the office and my son, Foster, and daughter-in-law, Lauren, have received them..[30] On 16 April, the club was put up for sale.[31] Hicks later claimed that he believed the club had tripled in value during his tenure,[32] and boasted that he would be looking for a price of four times what he purchased his stake for.[33] On 16 June 2010, Walton MP Steve Rotherham tabled a motion in the House of Commons expressing dismay at the continuing ownership of the club. Tom Hicks and co-owner George Gillett were described as "asset strippers" and the club was being "drained by their greed"[34].

Philanthropy

Hicks was the 1996 co-chair of the "Dallas Jewish Coalition for the Homeless "Vogel Alcove" project", and received the 2000 "Henry Cohn Humanitarian Award" from the Anti-Defamation League.[35]

References

  1. ^ "TJHS Class of 1964". Tjhs1964.com. 2009-11-08. Retrieved 2010-07-09.
  2. ^ "The University of Texas at Austin Interfraternity Council". Texasifc.org. Retrieved 2010-07-09.
  3. ^ a b [1][dead link]
  4. ^ COMPANY NEWS; Hicks & Haas Founders Split New York Times, May 11, 1989 . Retrieved April 18, 2010.
  5. ^ Kreutzer, Laura Til Key Man Do Us Part: Famous Private Equity Break-Ups Wall Street Journal, February 12, 2010. Retrieved April 18, 2010.
  6. ^ Lau, Debra Forbes Faces: Thomas O. Hicks Forbes, April 23, 2001. Retrieved April 17, 2010.
  7. ^ Morrison, Mark (2006-06-06). "This Buyout Game Ain't Over Yet". Business Week. The McGraw-Hill Companies. Retrieved 2008-04-28.
  8. ^ [2] SEC EDGAR Website . Retrieved April 17, 2010.
  9. ^ [3]
  10. ^ [http://www.hickssportsmarketing.com
  11. ^ Chan, Sewell (2005-01-22). "RUDOLPH GULIANI FOR PRESIDENT – 2008". Greatdreams.com. Retrieved 2010-07-09.
  12. ^ "Tom Hicks Elementary School – Frisco, Texas – TX – school overview". Greatschools.net. Retrieved 2010-07-09.
  13. ^ Font size Print E-mail Share (1998-01-08). "Stars owner Hicks to buy Rangers for $250 million". CBS News. Retrieved 2010-07-09.
  14. ^ http://www.mirror.co.uk/sport/football/2008/01/27/brazilian-fans-hit-out-at-liverpool-owner-98487-20300636/
  15. ^ "A-Rod, Rangers agree to richest deal in sports history". December 11, 2000. Retrieved September 4, 2010.
  16. ^ Saturday (2010-01-23). "Baseball Time in Arlington: A Texas Rangers Blog – The Clubhouse – NEWSFLASH: Final Agreement Reached In Rangers Sale". Bbtia.com. Retrieved 2010-07-09.
  17. ^ By T.R. Sullivan / MLB.com. "Hicks: MLB not restricting Rangers' funds | texasrangers.com: News". Mlb.mlb.com. Retrieved 2010-07-09.
  18. ^ [4][dead link]
  19. ^ Calcaterra, Craig (2010-01-26). "The Rangers deal is not a done deal – HardballTalk – Baseball – NBC Sports". Bases.nbcsports.com. Retrieved 2010-07-09.
  20. ^ ^ http://www.nbcdfw.com/news/sports/Hicks-Sued-Over-Glorypark-Land-Near-Ballpark-82795472.html
  21. ^ ^ http://www.dallasnews.com/sharedcontent/dws/spt/baseball/rangers/stories/020210dnsporanghicks.3204f79.html
  22. ^ Maury Brown (2010-05-24). "Texas Rangers Voluntarily Go Into Chapter 11 Bankruptcy to Finish Sale to Greenberg/Ryan Group". www.bizofbaseball.com. Retrieved 2010-05-24.
  23. ^ "HSG Claims Crane Made Higher Offer Than Greenberg For Rangers". sportsbusinessdaily.com. June 14, 2010. Retrieved June 14, 2010.
  24. ^ RICHARD SANDOMIR (June 11, 2010). "Rangers' Sale Price Could Have Been Higher, Creditors Say". New York Times. Retrieved June 14, 2010.
  25. ^ "Consortium pulls out of Reds bid". BBC News. January 31, 2007. Retrieved May 25, 2010.
  26. ^ "BBC SPORT | Football | My Club | Liverpool | US pair agree Liverpool takeover". BBC News. 2007-02-06. Retrieved 2010-07-09.
  27. ^ Anfield Online (2008-02-26). "The Anfield Divorce". Anfield Online. Retrieved 2010-07-09.
  28. ^ CNN http://sportsillustrated.cnn.com/2008/soccer/03/07/bc.soc.liverpool.ownership.ap/index.html. {{cite news}}: Missing or empty |title= (help) [dead link]
  29. ^ Northcroft, Jonathan (2008-04-13). "Anfield anarchy". The Sunday Times. London: News International Group. Retrieved 2008-04-13.
  30. ^ I can no longer work with Tom Hicks, says George Gillett Jr[dead link]
  31. ^ "Kop out! Liverpool owners Tom Hicks and George Gillett confirm club is for sale | Mail Online". London: Dailymail.co.uk. 2010-04-16. Retrieved 2010-07-09.
  32. ^ "Football | Premier League | News | Hicks – No cut-price deal". Sky Sports. 2010-04-18. Retrieved 2010-07-09.
  33. ^ "I should make four times my money selling Liverpool FC, claims Tom Hicks > Liverpool FC > Sport". Click Liverpool. Retrieved 2010-07-09.
  34. ^ "Liverpool FC owners Hicks and Gillett 'draining club'". BBC News. 2010-06-17. Retrieved 2010-07-09.
  35. ^ "Texas Rangers Executives". Texas.rangers.mlb.com. Retrieved 2010-07-09.



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