Vail Resorts to acquire Okemo, Sunapee, Crested Butte for $82 million

Okemo Mountain Resort photo by Rob Bossi.

by Timothy McQuistonVermont Business Magazine Colorado-based Vail Resorts, Inc(NYSE: MTN) continues to storm across North America, spread the influence of its Epic pass and gobble up another Vermont resort. This time it's Okemo in Ludlow. Last year it was Stowe Mountain Resort.Vail announced today it will buy a total of four resorts. It has entered into an agreement to purchase Triple Peaks, LLC, the parent company of Okemo Mountain Resort, Mount Sunapee Resort inNew Hampshire, and Crested Butte Mountain Resort inColorado. Vail will purchase Triple Peaks from the Mueller family for a purchase price of$82 million, subject to certain adjustments. At closing, Triple Peaks will pay$155 millionto pay off the leases that all three resorts have with Ski Resort Holdings, LLC, an affiliate of Oz Real Estate, with funds provided by Vail Resorts.

"We know our guests and employees will benefit from Vail Resorts' outstanding track record of resort and community investment, environmental stewardship, and employee development," saidTim Mueller, president of Triple Peaks, LLC. "We care deeply about the legacy of these resorts, and have absolute confidence in Vail Resorts to celebrate what makes them so special, while also providing long-term stability for the communities."

Okemo received a "Best Places to Work in Vermont" award this year from Vermont Business Magazine. Okemo employs 165 year-round, exclusive of seasonal peaks.

As part of a separate transaction, Vail Resorts will also purchase Stevens Pass Resort inWashington from Ski Resort Holdings, LLC, who was advised on the sale byHoulihan Lokey, for a total purchase price of$67 million, subject to certain adjustments. Both transactions are subject to certain closing conditions, including regulatory approvals. Altogether, Vail's spending spree will cost $304 million.

Diane and Tim Mueller (second and third from left) accept the Best Places to Work in Vermont award in March 2018 from VBM. They are pictured with employees and Governor Phil Scott. VBM photo

"Together, the acquisitions of Okemo,Mount Sunapee,Crested Butte, andStevens Passwill significantly enhance the Vail Resorts' network of resort experiences, adding even more variety and choice for all of our pass holders and guests. Okemo andMount Sunapeeare terrific complements toStowein the Northeast, as isCrested Butteto our fourColoradoresorts, andStevens Passfor our Whistler Blackcomb andSeattleguests," saidRob Katz, chairman and chief executive officer of Vail Resorts. "Additionally, each of these resorts will individually offer guests from around the world entirely new and distinctive experiences in extraordinary locations from coast to coast."

"Triple Peaks, LLC and the Mueller family andKarl Kapuscinski, the tenant and operator of Stevens Pass Resort, have been outstanding operators of these resorts and we have valued our association with them," saidSteven Orbuch, founder and president of Oz Real Estate. "We are excited for the opportunities that these transactions create for Vail Resorts and its guests while providing a beneficial outcome for our investors."

When the transactions close, the 2018-19 Epic Pass, Epic Local Pass, Epic Australia Pass, and Epic Military Pass will include unlimited and unrestricted access to all four resorts, with seven and four unrestricted days for the Epic 7 Day and Epic 4 Day passes, respectively. Whistler Blackcomb Edge Card holders will be able to use any of their U.S. days atStevens Pass, subject to the restrictions on each card. "We are thrilled that the Epic Pass and our other season pass products will now provide our pass holders around the world with even more variety and unique experiences to choose from," saidKirsten Lynch, chief marketing officer of Vail Resorts.

After closing of the two transactions, Vail Resorts plans to invest$35 millionover the next two years across the four resorts to continue to elevate the guest experience. In addition, annual ongoing capital expenditures are expected to increase by$7 millionto support the addition of these four resorts. Together, these acquisitions are expected to generate incremental annual EBITDA in excess of$35 millionin Vail Resorts' fiscal year endingJuly 31, 2019.

Closing of Transactions

The transactions are expected to close this summer. Operations at the four resorts for the remainder of the 2018 summer season will continue in the ordinary course of business, as will future winter seasonal hiring. Upon closing, Vail Resorts plans to retain the vast majority of each resort's employees and will be working with the local leadership teams in the coming months to determine the right long-term management structure for the resorts.

Vail Resorts will, subject to approval, assume the state land leases for Okemo Mountain Resort and Mount Sunapee Resort and will obtain new Special Use Permits from the U.S.Forest Servicefor Crested Butte Mountain Resort and Stevens Pass Resort. The state land lease transfers inVermontandNew Hampshireare subject to administrative review and consent from their respective states.

About the Resorts

Rising above theVermontvillage ofLudlow, approximately three hours fromBostonand four hours fromNew York City, Okemo Mountain Resort has developed a reputation for superior guest service, incredible snow quality, grooming, terrain parks, and family programs.

Crested Butte Mountain Resort, located in southwestColorado'sGrand Mesa Uncompahgre andGunnison(GMUG) National Forests, is known for the colorful and historic town ofCrested Butte, renowned mountain peaks, and legendary skiing and riding terrain. The resort was established in 1961 and has since passed through three families. The Muellers addedCrested Butteto their family of resorts in 2004, following their 1982 acquisition of Okemo Mountain and 1998 acquisition of Mount Sunapee.

Mount Sunapee, the premier ski area in southernNew Hampshire, is just a short 90-minute drive fromBoston. The four-season, family-focused ski area has breathtaking views overlooking Lake Sunapee and consistently receives accolades for excellence in snowmaking and grooming.

On the other side ofthe United States,Stevens Pass, with its exciting terrain and plentiful snowfall, will be the Company's second resort in the Pacific Northwest. The resort, less than 85 miles fromSeattle, sits on the crest ofWashington State'sCascade Range within two national forests, the Mt. Baker-Snoqualmie National Forest on the west side of the crest and the Wenatchee National Forest on the east.

Pass Access Details

Vail Resorts is offering the following benefits for 2018-19 Epic, Epic Local, Epic Australia, Epic 7-Day, Epic 4-Day, and Military Epic Pass holders, subject to closing of the transactions:

  • Epic Pass™:Ski or snowboard unlimited and unrestricted from opening day to closing day for only$899. The Epic Pass pays for itself in just over four days of skiing or snowboarding. Enjoy full access toVail,Beaver Creek,Breckenridge,Keystone, Crested Butte Mountain Resort andArapahoeBasin inColorado;Park CityinUtah; Heavenly,NorthstarandKirkwoodatLake Tahoe; Stowe Mountain Resort and Okemo Mountain Resort inVermont;Mount SunapeeinNew Hampshire; Afton Alps inMinnesota; Mt.BrightoninMichigan;Wilmot MountaininWisconsin;Stevens PassinWashington; Whistler Blackcomb inCanada; and Perisher inAustraliafor the 2019 season. New for the 2018-19 season, Epic Pass holders will receive seven days of skiing or snowboarding with no blackout dates at Telluride inColorado; seven days at Resorts of the Canadian Rockies, which includes Fernie Alpine Resort, Kicking Horse Mountain Resort and Kimberley Alpine Resort inBritish Columbia, Nakiska inAlberta, and Mont Sainte Anne andStonehaminQuebec; and up to five total consecutive days with no blackout dates at Hakuba Valley's nine ski resorts inJapan. The Epic Pass also grants limited access to Les 3 Vallées, Paradiski and Tignes-Val D'Isere inFrance; 4 Vallées inSwitzerland; Arlberg inAustriaand Skirama Dolomiti inItaly. A child pass (ages five to 12) is$469.
  • Epic Local Pass™:For$669, receive unlimited and unrestricted skiing or snowboarding atBreckenridge,Keystone,ArapahoeBasin,Crested Butte, Okemo,Mount Sunapee,Stevens Pass, Wilmot, Afton Alps and Mt.Brightonwith limited restrictions atPark City, Heavenly,Northstar,Kirkwood, andStowe, plus a combined total of 10 days atVail,Beaver Creek, and Whistler Blackcomb with holiday restrictions. New for the 2018-19 season, Epic Local Pass holders will receive five total consecutive days with no blackout dates at Hakuba Valley's nine ski resorts inJapan. The Epic Local Pass pays for itself in just over three days. A child pass (ages five to 12) is$359.
  • Epic 7-Day Pass™:For$669, receive a total of seven unrestricted days at Whistler Blackcomb,Vail,Beaver Creek,Breckenridge,Keystone,Park City, Heavenly,Northstar,Kirkwood,Stowe,Crested Butte, Okemo,Mount Sunapee,Stevens PassandArapahoeBasin, plus seven additional free days at Afton Alps, Mt.BrightonorWilmot Mountain. New for the 2018-19 season, Epic 7-Day Pass holders will receive up to seven days of skiing or snowboarding at Telluride and at Resorts of the Canadian Rockies with no blackout dates as part of their seven total days on the pass. After the seven days, regardless of the resort at which they were redeemed, pass holders can get 20 percent off additional lift tickets at Telluride. A child pass (ages five to 12) is$359. The pass pays for itself in just over three days.
  • Epic 4-Day™:A convenient option for a short ski trip as the pass pays for itself in just over two days and includes a total of four unrestricted days valid at Whistler Blackcomb,Vail,Beaver Creek,Breckenridge,Keystone,Park City, Heavenly,Northstar,Kirkwood,Stowe,Crested Butte, Okemo,Mount Sunapee,Stevens PassandArapahoeBasin, plus four additional free days at Afton Alps, Mt.BrightonorWilmot Mountain. New in 2018-19, Epic 4-Day Pass holders will receive up to four days of skiing or snowboarding at Telluride and at Resorts of the Canadian Rockies with no blackout dates as part of their four total days on the pass. After the four days, regardless of the resort at which they were redeemed, pass holders can get 20 percent off additional lift tickets at Telluride. The Epic 4-Day Pass is$439for adults and$239for children (ages five to 12).
  • Military Epic Pass:In celebration of the 10th anniversary of the Epic Pass onMarch 18, 2018, Vail Resorts is honoring the epic service of the Company's founders from the U.S. Army's 10th Mountain Division, and the men and women of the U.S. Armed Forces, Canadian Armed Forces and Australian Defence Force with the introduction of a new$99Military Epic Pass for active and retired military personnel and their dependents – an almost 90-percent discount to the regular Epic Pass price. Additionally, as the first of its kind in the mountain resort industry, all other U.S., Canadian and Australian veterans and their dependents are eligible for a$499Military Epic Pass, which offers more than a 40-percent discount off the regular price ($269for children under 18 years of age). Vail Resorts will donate$1for every 2018-19 season pass sale to Wounded Warrior Project® to benefit wounded veterans and their families, which would exceed$750,000based on last year's sales. Visitwww.epicpass.com/militaryfor all details on military pass options.

Vail Resorts' 2018-19 season passes are on sale now at the lowest guaranteed prices. Visitwww.epicpass.comfor details and to purchase.

Vail Resorts will continue to honor previously sold 2018-19 season pass products for Okemo,Mount Sunapee,Crested Butte, andStevens Pass.

RELATED STORY:Vail buys Stowe Mountain Resort

About Vail Resorts, Inc.
Vail Resorts, Inc., through its subsidiaries, is the leading global mountain resort operator. Vail Resorts' subsidiaries operate 11 world-class mountain resorts and three urban ski areas, includingVail,Beaver Creek,BreckenridgeandKeystoneinColorado;Park CityinUtah; Heavenly,NorthstarandKirkwoodin theLake Tahoearea ofCaliforniaandNevada; Whistler Blackcomb inBritish Columbia, Canada; Perisher inAustralia;StoweinVermont;Wilmot MountaininWisconsin; Afton Alps inMinnesotaand Mt.BrightoninMichigan. Vail Resorts owns and/or manages a collection of casually elegant hotels under the RockResorts brand, as well as the Grand Teton Lodge Company inJackson Hole, Wyo.Vail Resorts Development Company is the real estate planning and development subsidiary of Vail Resorts, Inc. Vail Resorts is a publicly held company traded on the New York Stock Exchange (NYSE: MTN). The Vail Resorts company website iswww.vailresorts.comand consumer website iswww.snow.com.

About Oz Real Estate
Oz Real Estate, the real estate platform at Oz Management, was founded bySteven E. Orbuchin 2003 to make investments in real estate and real estate related assets acrossNorth AmericaandEurope. The principals of Oz Real Estate have invested in over$9.0 billionof private real estate assets, including direct equity investments, preferred equity structures, mezzanine financing, and senior loans. Oz Real Estate's portfolio has included over 20,000 hotel rooms, over 30,000 multifamily and residential units, and over 20 million square feet of retail and office properties. In addition, Oz Real Estate has developed expertise in certain niche real estate asset classes including gaming, healthcare, senior housing, cellular towers, ski resorts, and land development. For more information on Oz Real Estate, please see ozm.com.

SOURCE: BROOMFIELD, Colo.,June 4, 2018/PRNewswire/ --Vail Resorts, Inc.www.vailresorts.com