Intrawest sells to Aspen and KSL

Discussion in 'General Skiing' started by SBrown, Apr 10, 2017.

  1. Jilly

    Jilly Lead Cougar Skier

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    What passes is/are Aspen on? Mountain collective, but only 2 days....what else. Haven't been interested before so knowledge.
     
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  2. quant

    quant Don't worry, just go down. Skier

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    Pre-sold lift tickets allow for more predictable revenue by smoothing out cash flow throughout the year regardless of weather. Investors in public and private equities will pay a higher multiple for firms with a more predictable cash flow. Therefore, this is a win-win. I don't think there is any way margins get compressed. Pre-sold tickets mean the skiers and boarders will get their 6+ days skiing somewhere and spend money on the mountain when they do. Plus, there will be economies of scale.
     
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  3. Ron

    Ron AKA Finndog Pugski Ski Tester

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    I would love to see the stats on the actual revenue on a per bundled ticket. its kind of like gift cards and rebates. the percentage full use is surprisingly low,
     
  4. SBrown

    SBrown Chuck Norris Admin Pugski Ski Tester

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    They sell a discounted Aspen Classic Pass, which is a 4- or 7-day pass (and a very good deal); they have done this for a while, predating the MCP. I'm not sure they are actually "on" any other passes. Season passes are still in the $2K level.
     
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  5. Ron

    Ron AKA Finndog Pugski Ski Tester

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    1799. IIRC but doesn't that include 4 mtns or am I mistaken?
     
    Last edited: Apr 10, 2017
  6. Philpug

    Philpug The Ski'er Admin Pugski Ski Tester

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    We were out skiing when this broke. I will say it was for some interesting chair lift fodder with @James and anyone who has been on a lift with knows how his conversations can go...and develop...and digress. I think this is great news and it is good to see a company stand up to Vail with plans to go against them head to head, mono a mano. I think this will be healthy and good for the skiing community. I also think there will be more news upcoming. with hwo this is going to play out and how everything will be structured. I also think we will be hearing more from the "independent" resorts left and from the Powdr's and Boynes of the skiing world. I think there isa good chance of these getting together to offer a third pass option. This is good for the consumer.
     
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  7. Tricia

    Tricia The Velvet Hammer Admin Pugski Ski Tester

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    :popcorn: & :rocks:
     
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  8. Muleski

    Muleski Making fresh tracks Industry Insider

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    I spent some time two weeks ago with somebody right in the thick of what's going on in the business with some of these deals. As of today, we have the Intrawest portfolio, and tacked onto it are Aspen and Squaw/Alpine. Seems like a bit of an odd group to some, in terms of what it looks like.

    Also looks like $1.5Bil, a 40% premium over the recent stock price, is a bit steep to drive traffic to Aspen and Squaw/Alpine. Does Aspen want and need more people? I would say no. Squaw has a lot of buzz, and a lot of challenges, but also a lot of skiers. And after this season, certainly more. Do you buy that group of areas to drive traffic? Or are you trying to end up with one or two special properties?

    Of the end game is to grab and hold onto a couple of properties, I get it.

    Sounds that the people who I know do not see this as some giant being formed to "take on" Vail Properties. The thinking is that KSL/SkiCo will do all that they can to increase the value of all of the properties as they then work to move a number of them.

    We'll see how it shakes out. I'm told it's not going to be business as usual, and hoping that Snowshoe skiers use some multi area pass to be able to travel and ski at Squaw. Think about Tremblant? Who might benefit the most by owing them? Some think it's VR. Or so I hear.
    Perhaps Och-Ziff makes a deal?

    To me, breaking up both of these portfolios of properties, eventually, makes sense. Particularly if the buyers really were targeting one, two or three properties only, and have had buyers lined up for others. The CNL deal still has wet ink on it, yet I have heard of a lot of conversation that has been taking place.

    Ever since SkiCo's name surfaced, I have been surprised. If there was a property that I thought they might have looked at, it was Stowe last summer and fall. And that's just based on tradition, cachet, etc. Not based on anything stunning business case. Like I have said, I understand why the Crowns are so imbedded in Aspen, and why they are the owners/stewards of SkiCo. Their looking to expand in the business perplexes me. When you spend time with Lester Crown and his family, you do not get the impression that you are with Rob Katz or the KSL team. However, Mike Kaplan is a player in the business. Well thought of. Perhaps he's been the inside champion of doing this.

    Aspen SkiCo is a big business. But the Crowns aren't your average owners. And Aspen is simply unique. I do not see Aspen for a minute feeling that they must change to compete with anybody. Saying that, I have family in both Aspen and Steamboat and they are pretty excited about the possibilities. Two great places.

    Maybe KSL wants to partner with SkiCo, in the end, on a couple of properties and have them oversee the mountain ops, etc. SkiCo has a great reputation. And the KSL group is very persuasive and smart. Obviously Squaw locals have their opinions! Keep in mind, KSL is the PE firm that owns the assets. It is NOT an actual operating company, though things get pretty blurry.

    As an example, Boyne is an operating company and a really good one. We might see them flip back to owning more properties,

    Very interesting. We'll see. Plenty of speculation going on already, for sure.

    It does give all of these areas access to capital, which is the biggest challenge facing smaller resorts that have decaying base lodges and very well used and aging lifts. That part is sad to me....but reality.

    Guess we stay tuned.
     
  9. David Chaus

    David Chaus formerly known as DesiredUsername Skier

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    Well...yes and no. Yes, competition should help prices in check. No, because competition for any item depends upon the accessibility of the competitor. On the mountain at Vail, f'r instance, you're not going to find a plethora of independent food purveyors, so the price of whatever they charge for food is not going to change just because a competing resort is just down the freeway a few miles. Unless there is a mass exodus of lunchtime traffic from Vail to somewhere else to eat, which I don't see happening, VR charges what the market will bear.

    Now, if there are realistic options for competition for season passes for destination travelers and locals alike (and it could be argued that already exists), that could make the season pass market more competitive, and possibly impact the pricing of all items including food so customers/clients/travelers don't feel gouged and try out the other guys for season passes. Except that seems to already be the case. Still doesn't change the equation of high food prices on the slopes.

    I dunno :huh: but having Aspen SkiCo in cahoots with KSL to manage/operate/develop Steamboat, Winter Park, or even Copper doesn't change much, at least in the short term. In the long term, with an emphasis on positive employee relationships, and a focus on customer service that is a consequence of treating employees like they matter (including adequate pay), well, that could change things over time.

    I say all this not really knowing anything about anything. I'm not a finance guy, I'm not in contact with people in the know, I'm not an industry insider. Just a guy who observes human behavior. An often inhuman behavior.
     
  10. Lorenzzo

    Lorenzzo Snow Skier Skier

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    Not really having many facts given publicly so far, we still know a few things. In the current environment investment bankers are looking for assets that can be leveraged at current low interest rates knowing rates are about to increase. It's most likely the 40% premium to stock price is to a large extent the value difference via leverage at low rates.

    Private equity needs a story and I suspect they're bringing Aspen in for a piece to give them that. So this is probably mostly a capital play although I'm not saying things won't otherwise change. But the deal probably wasn't driven by concern over competition.
     
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  11. nay

    nay low C turns Skier

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    1) KSL needs an operating company (see: Tahoe thread);

    2) Vail has major full luxury resorts positioned at four major North America metropolitan area ski markets and sold 500,000 Epic Passes last season before two of those markets even came online. This has to be taking share from somebody unless Vail is creating hundreds of millions of dollars of ski revenue;

    3) The Epic Pass is now global and priced 30%+ less than single resort passes at premium resorts that lack a major metro day trip market.

    Do we assume the attrition is coming from places like Loveland? Their lot has been pretty much full the 20 or so days I've skied there so far this season and a bowl of pretty decent green chili is still $6.

    Or is it coming from high priced more remote places with more (aging) infrastructure?
     
  12. nay

    nay low C turns Skier

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    It is interesting that on the one hand we have threads about Vail taking over the world, and on the other hand massive consolidation not being driven by this competition. In a market that is flat in terms of skier days.

    Which idols are false?
     
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  13. Lorenzzo

    Lorenzzo Snow Skier Skier

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    Well both can be going on but when you're talking about a 40% premium to stock price it's for sure driving it. If they can better position themselves at the same time they're smart enough to do it. And I think maybe we talk about consolidation speculatively but it doesn't seem to be depressing resort values at places like Steamboat when it gets capitalized at $1.5B so it's debatable how much they're worried about it.

    And how do we know this represents consolidation? Aspen is apparently in a management role. Another point, you don't need an operating company if you hire managers, which would be typical of a private equity driven situation.
     
    Last edited: Apr 10, 2017
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  14. Brian Finch

    Brian Finch PT, CSCS, Cert- DN, FRCms, M|WOD Coach Industry Insider

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  15. CalG

    CalG Putting on skis Skier

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    Really, Stratton is good for a about 2 weeks worth of ski days in a life time, then it gets a bit of "The big easy".

    I'm sure the business end is interesting, but I don't really care who runs it.

    You can't really "own" a mountain. The mountain will be there long after we all are gone...
     
  16. Bob Barnes

    Bob Barnes Getting off the lift Instructor

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  17. Ken_R

    Ken_R Getting off the lift Skier

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    Here are some numbers to throw in the discussion :popcorn:

    Screen Shot 2017-04-10 at 10.55.36 PM.png
     
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  18. KevinF

    KevinF Call me "Lefty" Skier

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    Fixed it for you.
     
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  19. Philpug

    Philpug The Ski'er Admin Pugski Ski Tester

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    Wow, Okemo's numbers are really skewed.
     
  20. lone pine

    lone pine Booting up Skier

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    That's why we don't ski weekends at Okemo. Or attempt to dine out.
     
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