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If you ski in New York you no doubt have heard of Mammoth, Stratton, and Whistler ski resorts, which have been owned by Intrawest Corporation. Intrawest has now agreed to be purchased by a private investment firm from New York, known as Fortress Investment Group LLC. The deal is worth 2.8 billion dollars in cash and is a landmark deal as Intrawest owns some of the most ideal ski real estate in the country as well as abroad.
Fortress Investment Group LLC has agreed to purchase Intrawest for $35 per share. Not only will Fortress pay for the shares, they will also assume nearly $992 million in debt that the corporation had acquired. It was partially this debt that led to the sale of the company in the first place. After the announcement that Intrawest would be sold the price of shares rose a whopping 29% on the New York Stock Exchange. Obviously, this story and the sale of this company and related properties have drawn much attention from investors.
This sale not only affects the shareholders of Intrawest but also affects a company known as Aspen Skiing Co. Aspen Skiing Company is currently developing a new Base Village at Snowmass in Colorado. This has been startling news for Aspen Skiing Company as they were equal partners in the building of this new resort and there has been no comment on what the future of the new resort will be now. Investors hope that Fortress will step in where Intrawest leaves off, but that remains to be seen. Aspen Skiing Company has only commented that they have put too much into the project not to see it until its completion. So it is certain that it will be completed, it’s just a question of whether they will partner with anyone new.
The deal between Fortress and Intrawest will not be complete until there is a two-thirds consensus of the shareholders. This is expected to be done easily as the sale is in the best interest of the shareholders as Intrawest currently has more debt than they know what to do with. Also, shareholders will be given a portfolio of some of the work the Fortress Investment Firm has done in the past to see that they are more than qualified to take on this project.
What remains to be seen is what will happen to the properties that Fortress has acquired. This is known as prime ski real estate where people flock to enjoy ski homes and ski condos. Some of these resorts are enjoyed by local families and from people from places far and wide. There is every indication that the investment firm will continue with the ski real estate business because it is profitable and simply good business, though the company will need some restructuring. The Intrawest deal is a big deal because it is making what has always been publicly held private, and with that change is bound to occur.
Keywords used: ski real estate, ski homes, ski condos
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