Steamboat could go to a private buyer

No, it's not what you think. As you probably know the Steamboat ski area is for sale but I’m pretty sure it’s not possible to make it a private resortsince it sits on public land. It just may be a private buyer that goes the distance. Potential buyers are in town this week and next along with top executives from the current owner American Skiing at the Steamboat Grand for management presentations. The deadline for the first round of bids is tomorrow. Some executives have mentioned around town that they hope to have a contract sometime in October for a December close. Let's hope we get new owner with the resources to invest in the mountain and a heart that knows why Steamboat is special & what not to change.

Selected quotes from the Rocky Mtn News (some editing for length) :
"Colorado's ski industry faces one of its biggest ownership shuffles in years. The latest wave of deals likely will put many areas back into private hands. What has changed? Private buyers tend to be coming to the table with gobs of capital. Before Wall Street arrived, ski-area ownership tended to be a largely local affair.

• Private equity firm and hedge fund giant Fortress Investments buying Canada's Intrawest Corp., the public company that owns Copper Mountain and operates Winter Park.
• Publicly held American Skiing Co. putting its marquee Steamboat Ski Resort - viewed as the seventh biggest nationwide - on the block.

"There's a lot of activity right now; it seems to come in these cycles and waves," said Dave Belin, at RRC Associates, a Boulder- based research firm. "Some of these resorts have been doing really well over the last couple years. It's a sell- high mentality. You buy low, and you sell high." That's particularly the case with Steamboat, whose financial performance has improved steadily in the past few years even as its parent company's stock languishes. Given the huge amounts of capital private equity investors have on their hands, observers say the odds of Steamboat attracting a private buyer are high. Recent buyouts all have been funded by private investors. Only Crested Butte's new owner had other ski areas in his portfolio.

"It's a pretty common perception that ski areas only make their money on the real estate sales," said RRC's Belin. "But would Eldora and the others still be operating their ski resorts after all these years if they weren't making any money?" The private equity model can match well with the need for big capital outlays because private owners tend to be far more comfortable taking on debt than public companies, said Sheila Broughton, who tracks Intrawest."

See the full article in the Rocky Mtn news here

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