American Skiing Co. is dismantled
June 23, 2007
With Park City-based American Skiing Company dissolving, The Canyons, which is owned by the publicly traded firm, could be for sale, according to documents filed Thursday with the Securities and Exchange Commission.
"We intend to sell The Canyons pursuant to our plan of dissolution. The timing of such sale is uncertain at this time," the SEC filing states.
American Skiing Co. is effectively going out of business and therefore ownership of The Canyons is expected to shift to Oak Hill Capital Partners, a private firm that is the majority shareholder in ASC, because money to pay Oak Hill’s preferred stock obligation of $404 million is not available, according to the SEC.
"There is nothing out of the ordinary here," American Skiing Co. spokesman Chip Carey said.
But most people who bought stock in American Skiing Company shouldn’t expect any return on their investment, said Dave Hirasawa, who is American Skiing Co.’s director of financial analysis and investor relations.
"There has been value created, it just does not filter down to the common stock," he said, referring to American Skiing Company dumping seven of its eight resorts since December.
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Proceeds from the sales relieved the company of debt however soon shares in American Skiing Company, which sold Friday on the Over the Counter Bulletin Board for a nickel, will no longer be publicly traded.
A stock analyst in Maine who has watched American Skiing Company since it was taken public in 1997 claimed "these guys managed the resorts for themselves and I think just about every community you go to, people have been relieved when [ASC] has sold these mountains."
"I feel bad for the people in Park City because what you’re left with is this group. Everybody knows how they have behaved here since they came in and now they want to be the heroes in Park City," continued Brad McCurtain, of Maine Securities Corporation, in Portland, Maine.
But ASC President and CEO William J. Fair hasn’t poorly managed the company as McCurtain claims, Hirasawa countered.
"The company has done a very good job," he said.
Meanwhile, Fair owns 400,000 shares of common stock in American Skiing Co., according to SEC filings.
"You bet on teams of people who make money for people and then there are others who don’t have that kind of track record. These guys have managed the company for themselves and there is no getting around that," McCurtain said. "Today people are happy to see them go and I don’t think there will be any tears shed when they eventually take the company private."
When American Skiing Company announced the sale of its Steamboat resort to Intrawest ULC for $265 million, Fair told The Park Record it would create "value for all of our shareholders."
"Hopefully, shareholders knew there were some risks involved, but I think most people figured the resorts should have brought more money that what they brought, and the common shareholder should have ended up with something," McCurtain said.
Instead, those who bought American Skiing Company stock get nothing, company executives say. Within a month formal dissolution of the company is expected to occur as are layoffs as ASC’s Park City headquarters.
For now, ownership of American Skiing Co.’s remaining assets that include The Canyons, will be transferred to Oak Hill, the largest shareholder.
While selling The Canyons to a different operator is "certainly a possibility," Hirasawa stressed that "we have no agreements in place to do so."
"The Canyons is not for sale right now," Carey said.
Other resorts sold this year by American Skiing Co. include: Mount Snow in Vermont, Attitash in New Hampshire, and Killington and Pico in Vermont, and Sunday River and Sugarloaf/USA in Maine.
"This has been a great example of how not to run a publicly traded company," McCurtain said about the demise of American Skiing Company.