American Skiing Backs Out of Steamboat Sale
03/28/02 12:00AM By Steve Zind
(Host) News that the American Skiing Company has cancelled plans to sell a Colorado Ski Area to the owners of Okemo Mountain has taken the ski industry by surprise. The last minute announcement came as a group of investors led by Okemo's Tim and Diane Mueller were preparing to close the deal.
VPR's Steve Zind reports.
(Zind) American Skiing Company's announcement that it would not sell its Steamboat Springs ski area to a group of investors led by the Muellers was an industry bombshell. Tim Mueller was in New York for the closing when a phone call came informing him the sale was off.
Instead, American Skiing has decided to sell the Heavenly Ski Area near Lake Tahoe to the Vail Resort Company. American Skiing said the change in plans is the final step in its effort to reduce a four hundred million dollar debt. The plan also included last year's sale of the Sugarbush Resort in Warren. In a prepared statement, American Skiing said it decided not to sell Steamboat as a result of discussions with its lenders.
Tim Mueller released a brief statement calling the decision "outrageous." Mueller says he is consulting with his lawyers about the best course of action.
Mary McKhann is Managing Editor of the Snow Industry Letter. McKhann says hanging onto Steamboat makes sense for American Skiing because it's got greater potential to make money. She says the $100 million generated by the sale of Heavenly is just a quick fix.
(McKhann) "This will probably get them out of their immediate crisis. I don't see it solving its long term problems. You have good winters and bad winters and somehow American Skiing keeps blaming bad weather but that's not the real issue. They're not making as much money as they should be making."
(Zind) McCann says if American Skiing has to sell another resort, it will likely be one in the East. The company owns Killington and Mount Snow in Vermont and ski areas in New Hampshire and Maine.
The news came as a shock to residents of the town of Steamboat Springs. Reporter Tom Ross has been following the sale for the Steamboat Pilot Newspaper. Ross says townspeople were looking forward to the sale.
(Ross) "People are deflated. I think people have had ten months believing that they'd get a fresh start in terms of ownership and that American Skiing Company's financial problems, their mountain of debt is no longer our problem. But people woke up this morning and realized that that mountain of debt is their mountain."
(Zind) Ross says American Skiing Company's financial problems have affected the community. The company is Steamboat Springs' largest employer.
For Vermont Public Radio I'm Steve Zind.