Vail Resorts to acquire 4 additional resorts (updated)
June 4, 2018
Days before the release of its next earnings report, Vail Resorts has announced it intends to buy four more ski resorts over the summer, including Okemo Mountain in Vermont, Mount Sunapee in New Hampshire, Stevens Pass in Washington and Crested Butte here in Colorado.
According to a Monday announcement, the company has entered into an agreement to buy the Okemo, Sunapee and Crested Butte resorts' parent company, Triple Peaks, from the Mueller family for $82 million, pending any adjustments before closing.
News of the sale was met with mixed reactions in Crested Butte, as some people felt optimistic the sale could mean more skier traffic, stronger marketing campaigns and even more options for Epic Pass holders. Others worried about what it could mean for the family-owned resort and character of the town.
Crested Butte opened in 1961 and has passed through three families since, including the Muellers, who added it to their lineup of family-owned resorts in 2004.
Per the agreement, Triple Peaks will pay $155 million at closing to pay off the leases that all three resorts have with Ski Resort Holdings, an affiliate of Oz Real Estate, with cash from Vail Resorts, which owns three resorts in the Tahoe region: Heavenly Mountain Resort, Kirkwood Mountain Resort and Northstar California.
In a separate sale also announced Monday, Vail Resorts detailed its plans to buy Stevens Pass Resort in Washington for $67 million from Ski Resort Holdings.
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Both sales are subject to certain conditions, including regulatory approvals.
"Together, the acquisitions of Okemo, Mount Sunapee, Crested Butte and Stevens Pass will significantly enhance the Vail Resorts' network of resort experiences, adding even more variety and choice for all of our pass holders and guests," said Rob Katz, chairman and CEO of Vail Resorts, in a prepared statement.
After the purchases, the Epic Pass products will include unlimited and unrestricted access to all four resorts.
Additionally, Vail Resorts plans to invest $35 million over the next two years at the four resorts, according to the company, while ongoing, annual capital expenditures are expected to increase by $7 million with the additions.
Operations at the four resorts for the remainder of the 2018 summer season will continue unchanged, as will future winter seasonal hiring.
Gary Huresky, a Realtor and member of the Crested Butte/Mount Crested Butte Chamber of Commerce Board of Directors, said he's looking forward to Vail Resorts' presence in the area.
"There's mixed emotions around town," Huresky noted. "But in my opinion, it's a welcome endeavor."
Huresky explained that Crested Butte's ski resort has needed on-mountain improvements for some time now, and he added that Vail Resorts' marketing muscle could help bring more people to the area.
"We'll see what happens with the transition … but we're a ski town; let's get folks in here with experience and capital," he said.
There's also hopes the sale could boost numbers at the Gunnison County Airport, and Crested Butte/Mt. Crested Butte Chamber of Commerce Director Ashley UpChurch said the group believes the move will be positive for the business community.
For those who plan on skiing or riding with an Epic Pass next year, it could mean good news for them, too.
Tom Foley, senior vice president of business intelligence at Inntopia, a market-research firm and a longtime analyst of the resort industry, said expanding the reach of the Epic Pass has been a key part of Vail Resorts' strategy for some time now.
"It's guaranteed revenue in an industry that some see as having a shrinking weather window," he explained.
Beyond that, Foley sees Monday's announcement as evidence of another one Vail Resorts' strategy, specifically there's been a shift in the kinds of resorts the company is acquiring. With the exception of the Whistler Blackcomb acquisition, Vail Resorts has moved from buying bigger resorts to more "Main Street?? ski areas, Foley said.
Places like Stowe, Vermont, and even Park City, Utah, have a different look and feel than Vail, Beaver Creek or Keystone, Foley explained.
Vail Daily Business Editor Scott Miller contributed to this report.
Original Post: Vail Resorts to acquire Crested Butte, two other resorts
Vail Resorts announced Monday the company intends to buy three more ski resorts this summer, including Okemo Mountain Resort in Vermont, Mount Sunapee Resort in New Hampshire and Crested Butte Mountain Resort in Colorado.
According to a Monday news release, Vail Resorts has entered into an agreement to buy the three resorts’ parent company, Triple Peaks, from the Mueller family for $82 million, pending any adjustments before closing.
At closing, Triple Peaks will pay $155 million to pay off the leases that all three resorts have with Ski Resort Holdings, an affiliate of Oz Real Estate, with cash from Vail Resorts, which already owns the Breckenridge and Keystone ski resorts in Summit County.
In a separate transaction, Vail Resorts will also buy Stevens Pass Resort in Washington from Ski Resort Holdings for $67 million, which again is subject to adjustments. Both sales are subject to certain conditions, including regulatory approvals, before closing.
“Together, the acquisitions of Okemo, Mount Sunapee, Crested Butte, and Stevens Pass will significantly enhance the Vail Resorts’ network of resort experiences, adding even more variety and choice for all of our pass holders and guests,” said Rob Katz, chairman and chief executive officer of Vail Resorts, in a prepared statement.
With the purchases, the Epic Pass is expected to include unlimited and unrestricted access to all four resorts. After closing the sales, Vail Resorts also plans to invest $35 million over the next two years across the four resorts, according to the company. Ongoing, annual capital expenditures are expected to increase by $7 million to support the addition of these four resorts.
Together, these acquisitions are expected to generate incremental annual EBITDA in excess of $35 million in Vail Resorts’ fiscal year ending July 31, 2019. Operations at the four resorts for the remainder of the 2018 summer season will continue in the ordinary course of business, as will future winter seasonal hiring.
Upon closing, Vail Resorts plans to retain the vast majority of each resort’s employees and will be working with the local leadership teams in the coming months to determine the right long-term management structure for the resorts, according to the company.
Vail Resorts also plans to obtain a new special use permit from the U.S. Forest Service for Crested Butte.
Crested Butte Mountain Resort is in southwest Colorado. The resort first opened in 1961 and has since passed through three families. The Muellers added Crested Butte to their family of resorts in 2004, following their 1982 acquisition of Okemo Mountain and 1998 acquisition of Mount Sunapee.
CORRECTION: The original headline for this story said Vail Resorts was acquiring Crested Butte and three other resorts. It has since been corrected.
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