Quick Update: Vail Resorts just acquired Park City ski resort by suing Park City ski resort for Talisker, the owner of the land that Park City operates on. Park City did a silly thing and let their super cheap lease expire and Vail dropped in hard. So, Vail will now be running Park City ski resort.
Since Vail took over, Wall Street has approved the maneuver and thinks that Vail will combine two adjacent resorts (both are run by Vail now) creating the largest ski resort in the USA.
All this may be premature, however. Powdr Corp, the guys who used to run Park City, have appealed the court’s ruling. They also own the base of the mountain and they’re threatening to not cooperate. The court has ruled that Powdr Corp is not allowed to impede progress. Powdr Corp may still have a chance at at least causing Vail some delay, but that might be just about it. It’s not looking good for Powdr Corp. Not renewing that lease was a hugely enormous faux pas.
As soon as the news that Vail was going to take over Park City, Talisker’s stock went up 5%. Wells Fargo thinks Vail Resorts’ stock is going to jump as a result of this move, as well.
“Resolution was faster than expected, we felt a ruling might still be months away. We expect a favorable reaction to the stock [Vail Resorts’ stock] although we think some of this outcome was already priced in.” – Wells Fargo report
Credit Suisse is bank and financial analyst that covers Vail Resorts. Credit Suisse thinks that Vail will try to combine Park City and The Canyons now that it runs both of them.
“The ability to combine Canyons and PCMR . . . has the potential to create a world-class destination, helping MTN [Vail’s ticker symbol] to ‘create’ another Vail Mountain with more terrain, phenomenal accessibility (30m drive from SLC), and a terrific mountain town that has all the amenities high-end guests want.” – Credit Suisse
They might be right… The Canyons and Park City ski resort are both on private land. Both on Talisker’s private land. Connecting them would be easy for Vail both financially and physically. The two ski resorts are right next to each other.
“This [both ski resorts being on private land] is a key difference and should allow MTN [Vail Resorts’ stock name] to ultimately upgrade these resorts more quickly (lifts, terrain, ancillary amenities) and find partnership opportunities to develop real estate.” – Credit Suisse
The Canyons has 4,000 skiable acres. Park City has 3,300 skiable acres. Combined, they’d have over 7,400 skiable acres making it the biggest ski resort in the USA and the 2nd largest ski resort in North America behind Whislter Blackcomb’s 8,000 acres.
So, what do you think. Is Vail’s taking over a good thing? Is combining the two resorts a good thing?