Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Vail Resorts has agreed to buy the Crans-Montana ski resort in the Swiss Alps, in a SFr118.5mn ($136mn) deal that will give the Colorado-based group ownership of an iconic European holiday destination.
Crans-Montana is known for its gourmet food, glitzy shops and golf courses as well as winter sports. Sitting in the Swiss canton of Valais, roughly 2.5 hours from Geneva, it regularly hosts downhill ski races, the Omega European Masters golf tournament, and in 2025 it will host the Mountain Bike World Championships, followed by the World Ski Championships two years later.
The deal marks the end of CPI Property Group’s ownership of the resort. CPIPG’s main shareholder is Radovan Vítek, the billionaire Czech investor who began to build his wealth as Slovakia privatised assets in the 1990s.
The sale follows a turbulent period for the Swiss resort marked by repeated clashes between Vitek and local authorities that even left the ski lifts idle in the winter of 2018 when CPIPG refused to operate them amid a payment dispute.
The abrupt closure in the midst of the ski season severely dented the resort’s reputation as a reliable Swiss tourism destination.
Vail said it would seek to grow Crans-Montana, concentrating on marketing and operational initiatives, including “capital investments focused on maximising gastronomy efficiencies and improving and expanding snow-making capabilities”.
The resort attracts about 3mn visitors a year, a fifth of whom come from mainly Italy and France. Vail expected it to generate approximately SFr5mn in earnings before interest, tax, depreciation and amortisation in the year to July 2025. The deal is expected to complete during the 2023-24 ski season.
The association of local municipalities located around the Swiss resort said that they hoped Vail would help Crans prepare better for the world ski championships. Bruno Huggler, the head of the Crans tourism office, said that Vail’s international footprint was “an undeniable asset, notably for the North American market.”
The acquisition will be Vail’s second in Europe after it acquired Andermatt-Sedrun in Switzerland in 2022. Crans-Montana will join an extensive portfolio that includes Vail Mountain in Colorado, Whistler in British Columbia and three resorts in Australia, together with the RockResorts hotel brand.
“Much like Andermatt-Sedrun, we believe Crans-Montana has a unique opportunity for future growth,” Vail chief executive Kirsten Lynch said.
However, there are challenges when expanding to the European market, said Patrick Scholes, who covers lodging and leisure at investment bank Truist Securities.
“Sometimes locals don’t like big corporations taking over their home resort,” he said. “The challenge would be that operating a ski resort overseas out of a corporate headquarters in Colorado is not necessarily easy.”
Vail’s New York-listed shares were down 0.8 per cent at $213.49 on Thursday, implying a market capitalisation of around $8.2bn.
Last week, short seller Muddy Waters accused Vitek of “brazenly looting the company while significantly overstating the value of its assets”. Muddy Waters said it was betting against CPIPG’s credit.
CPIPG said in response it believed Muddy Waters was “categorically wrong” about the company.
On Thursday, CPIPG noted that it had sold the Crans-Montana resort at a “significant premium” to the €51mn book value it had ascribed to the business at the end of June.
Read the full article here