Potential buyers to visit ski area

No 'midnight deals' with publicly traded company

Tom Ross

— Steamboat Ski Area President Chris Diamond and a handful of his vice presidents and managers spent a good part of the week preparing for important house guests.

Diamond confirmed that he and a portion of his management team were in long meetings this week getting ready for site visits from executives representing companies that have expressed a serious interest in purchasing the ski area. He believes the eventual buyer could be known within five weeks.

American Skiing Company, parent of the Steamboat Ski Area, announced in May that it intended to sell Steamboat as part of its corporate and financial restructuring.

“Over the next couple of weeks these groups will come into town,” Diamond said. “They’ll be given a fairly structured, informative presentation. They will go on tours and then there will be a question-and-answer session.”

Diamond would not name the companies or interested parties sending representatives to Steamboat, nor would he say how many different groups are expected. However, he said he expects the list of interested buyers to become public by late August.

If the sale process continues to stay on schedule, Diamond said a “definitive purchase and sale agreement” should be in place by September and the “contender” will be known. That would allow a couple of months for the sale to close before the end of the year.

American Skiing Company spokesman Skip King would say only that company officials are happy with the process thus far.

“We continue to be pleased by the number and quality of interested buyers,” King repeated.

Diamond agreed with King’s characterization.

“I think that’s a reality,” Diamond said. “I think there are a number of qualified and interested parties.”

ASC retained the investment banking firm Credit Suisse First Boston to act as its agent in the sale and prequalify buyers.

The first step in the process was preparation of a marketing booklet by the Steamboat staff. CSFB released company financial data to prospective buyers who signed a confidentiality statement. The company also asked prospective buyers to submit preliminary bids by July 27, Diamond said.

The site visits were arranged based on information CSFB compiled to assure the credibility of the bids.

Diamond agreed that the site visits represent an opportunity for the Steamboat team to make an impression on representatives of the future owner of the ski area. He said he has been through the process of buying or selling a ski area six or seven times and every time was different from the last. The experience varies with the personalities involved and whether or not the company is publicly or privately held.

Diamond said he continues to be amazed at the number of Steamboat residents who approach him seeking confirmation that the sale of the ski area is already a done deal. Diamond said that when publicly traded companies are sold, part of the role of the investment banking company involved in the transaction is to assure the board of directors achieves maximum return on behalf of its shareholders. Once negotiations reach a certain point, much of the process becomes public, Diamond said.

“How are you going to do a midnight deal when you have to satisfy shareholders?” Diamond asked.

The most difficult aspect of placing Steamboat under new ownership will begin soon after the deal is finalized, Diamond said. He’s already been talking to his employees about the importance of making a smooth transition.

“The real work starts the day after it closes making sure the cultures are properly married and that everybody understands their roles,” he said. “Frankly, I don’t think that ever happened with American Skiing Company.”

The history of American Skiing Company’s struggle to blend into Steamboat offers an advantage for the new ownership, Diamond said. It should be clear to them that many agencies and individuals are intensely interested and intimately connected to what happens at the ski area, he said.

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