Whistler Blackcomb to be sold to Colorado company
Geordon Omand, The Canadian Press
Published Monday, August 8, 2016 7:35AM PDT
Last Updated Monday, August 8, 2016 2:13PM PDT
VANCOUVER -- One of Canada's most popular and internationally renowned ski destinations is being sold to an American resort operator with the architects of the nearly C$1.4-billion deal citing financing for expansion and a push to attract more international visitors as benefits of the sale.
Colorado-based Vail Resorts Inc. has reached an agreement to buy Whistler Blackcomb Holdings, owner of Whistler Blackcomb ski resort, saying Monday the transaction would give the British Columbia tourism hub access to both the money and the markets it needs to grow its status as one of the world's leading, year-round ski havens.
"We have felt for a long time that Whistler (Blackcomb) is really the best positioned North American resort to benefit from the growth that we expect in outbound Chinese ski visitation, especially as China starts to ramp up towards the 2022 Beijing Winter Olympics," said Vail CEO Rob Katz on Monday.
"For our company to have a strong entree into that opportunity is meaningful."
The deal is expected to close in the fall.
Located about 120 kilometres north of Vancouver, Whistler Blackcomb is both the largest and the most popular ski destination in North America, with more than two million people visiting last year. It gained further renown on the world stage six years ago when it helped host the 2010 Winter Olympic Games.
Whistler Blackcomb CEO David Brownlie, who will stay on as chief operating officer once the deal closes, said a more diversified company has better long-term stability.
"We've both come off very strong years. We're both doing very well," Brownlie said about Whistler Blackcomb and Vail.
"We think that working with Vail will accelerate our business plan and we're excited to move forward with it."
Whistler Blackcomb pulled the curtains back earlier this year on an ambitious C$345-million expansion project, dubbed the Renaissance plan, to build more weather-independent facilities, improve infrastructure and expand its real estate offerings.
Vail's financial support and broad network of customers, including half a million seasons pass holders, will go a long way to boosting business at Whistler Blackcomb, said Brownlie.
Vail operates nine mountain resorts and two ski areas in the U.S. and Australia, making Whistler Blackcomb its first foray into Canada. Two years ago, Vail bought Utah's Park City Mountain Resort for US$182.5 million and merged it with a neighbouring resort.
Markets responded extremely well to news of the most recent deal, as Whistler Blackcomb's stock shot up more than 45 per cent by closing on Monday.
Whistler Blackcomb (TSX:WB) shareholders are being offered C$676 million of cash and Vail stock (NYSE:MTN) worth about C$715 million, making the deal worth nearly C$1.4 billion when it was announced.
Whistler Blackcomb shares closed in Toronto on Friday at C$25.14, giving it a market value of about C$960 million prior to Monday's announcement.
Shares of Whistler Blackcomb jumped to a new all-time high when markets closed Monday, rising to C$36.63 per share in Toronto, up by $11.49. In New York, Vail stock was also trading at its highest in at least a decade, closing at about US$155.
When it opened in 1966, the Whistler resort featured a four-person gondola, a double chairlift and a day lodge. It has since grown to become one of the premier ski destinations in North America. Whistler and Blackcomb, its rival at the time, merged in 1997, becoming the largest and most visited ski resort in North America.