Intrawest may be on the block

‘Review of strategic options’ fuels share price surge, sale speculation

Click to Enlarge Browse Vail Daily Photos Intrawest, the company that owns Copper Mountain, said Tuesday it will explore a sale of some or all of its assets. The Canadian company is the largest ski resort operator in North America. Brad Odekirk/Summit Daily Get News Feeds

Alex Miller
February 28, 2006

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VANCOUVER — While Vail Resorts shuffled its top management and announced plans to relocate its corporate headquarters to Denver, rival ski area operator Intrawest Corporation announced plans to explore a possible sale of some or all of its assets.

Canada-based Intrawest is the largest of the ski corporations, owning or operating 10 resorts in North America — including Copper Mountain and Winter Park in Colorado.

Following its announcement Tuesday to consider “strategic options available to the company for enhancing shareholder value,” the company’s stock surged up to 16 percent on the Toronto Stock Exchange — its biggest spike since 2000.

Intrawest said it has retained Goldman Sachs Group, Inc. to “assist in the review,” which investors interpreted as an announcement that it’s on the auction block.

“Intrawest says there is no assurance of a deal, but no one seems to believe that,” Sheila Broughton, a Pacific International Securities analyst, was quoted as saying in a Bloomberg Business News story.

“Intrawest stands at a pivotal point in its evolution,” Joe Houssian, Intrawest’s chairman, president and chief executive officer, said in a press release. “It makes sense for us at this time to evaluate all of the different ways in which we can capitalize on the opportunities in front of us for the benefit of shareholders, and to ensure that we have the best possible capital structure in place.”

Chris Woronka of Deutsche Banc, who follows the company, said in a note to investors that the news could be “read to include a partial or full sale of the company, potentially including privatization.”

Woronka also said, “it likely also reflects management’s dissatisfaction with the Street’s valuation of the company, although we note that shares are [up] 50% over the past year despite a challenging operating environment for many of [its] ski resorts and the fact that it operates in a mature, capital intensive industry.”

Alex Miller can be reached at 949-0555, ext. 14625, or amiller@vaildaily.com.

Vail Daily, Vail, Colorado