ASC inks deal with a buyer
But letter of intent means company can still court suitors for Steamboat
Steamboat Springs — American Skiing Co. came a step closer to selling the Steamboat Ski Area this week, signing a nonbinding letter of intent with a potential buyer.
But the parties involved refused to confirm a report that Tim and Diane Mueller, owners of Okemo Mountain ski resort in Vermont, are the tentative buyers.
ASC’s decision to sign the letter of intent became public when the company filed for an extension with the Securities and Exchange Commission. The extension gives ASC more time to produce its fourth-quarter earnings report. An attorney for ASC said the pending deal could affect the numbers in the report. ASC’s fourth fiscal quarter ended in late July.
The company has 15 days to finish up its report, possibly an indication the sale of Steamboat and the identity of its purchasers will become official within that time.
A spokeswoman for Okemo said Wednesday neither Tim nor Diane Mueller would make comments regarding the letter of intent for reasons of confidentiality. Okemo’s Pam Cruickshank said the Muellers’ silence on the matter could continue for another “week or two.”
Tim Mueller spoke freely about his interest in acquiring Steamboat in mid-October. He and his wife were identified among three finalists for the purchase of Steamboat. The others are a pair of investment banking firms Babcock & Brown, based in San Francisco, and Goldner Hawn Johnson & Morrison Inc. of Minneapolis.
Steamboat Ski Area President Chris Diamond said parties in the deal are bound by SEC regulations not to discuss it all of the details must be presented to the shareholders simultaneously, he said.
The extension sought by ASC specifies American Skiing is free to continue negotiations with other potential buyers as it moves toward a final deal with the potential buyer that signed the letter of intent.
“The next step is to sign a purchase and sale agreement,” but the company needs to protect itself from the possibility the current deal could fall through, ASC spokesman Skip King said.
King would not comment on a report that the letter of intent does not involve the Steamboat Grand Hotel in the purchase of the ski area.
The extension filed by ASC claims the pending sale of Steamboat necessitates the delay in filing.
“American Skiing Company recently entered into a non-binding letter of intent relating to the sale of Steamboat Ski & Resort Corporation,” the filing reads. “The sale of the Steamboat resort is a critical element of the company’s strategic plan.
“As a result, the company is currently negotiating critical terms of the proposed deal and with its auditors are evaluating the effect on its financial statements and related disclosures for the fiscal year ended July 29, 2001, and its credit agreements. In addition, the company is continuing negotiations with other potential purchasers of the Steamboat resort.”
Foster Stewart, ASC’s legal counsel, said to file the company’s fourth-quarter earnings report prior to finalization of the Steamboat deal would carry with it the risk of error.
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