Shareholder calls for Intrawest sale | AspenTimes.com
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Shareholder calls for Intrawest sale

Chad Abraham

Intrawest’s largest shareholder is calling for the development giant to sell the company to take advantage of the soaring worth of its vast real estate holdings.The stock price of Intrawest, which is partnering with the Aspen Skiing Co. on the $400 million Base Village project, finished at $34.20 Thursday, a leap of nearly $3 since February. The stock rose 74 percent in the past year.An analyst for Pirate Capital, a $1.8 billion hedge fund and Intrawest’s largest shareholder, told Intrawest’s leadership last month to consider “a sale of the whole company,” according to a Dow Jones report.That would bring in the most revenue for shareholders, Pirate Capital analyst Stephanie Tran wrote in a letter to Intrawest’s board. She said the company’s share price, and its land holdings, are undervalued.What effect, if any, a sale or merger of the company would have on Base Village is unclear. Michael O’Connor, Intrawest’s vice president of development, said his company and the Skico have put too much effort into bringing Base Village on board to let anything happen to the project.”I don’t see it changing,” he said. “With all this partnership has been through to get this project approved and then through the 404 permit … there’s been too much heart and soul poured into this, not to mention finance. We are fully engaged and prepared to move forward, and I wouldn’t see it impacting this project at all.”Snowmass Village Mayor Doug Mercatoris agreed.”The land is owned by the Crown family,” the Skico’s owners, he said. “I imagine if the transaction took place, whoever inherited or bought it would have to continue on with” Base Village.Besides Base Village, which is to bring 1 million square feet of development to Snowmass Village, Intrawest operates ski villages in Whistler, British Columbia, the site of the 2010 Olympics; Winter Park; and Copper Mountain. It also owns several golf course properties in the United States, real estate holdings in Europe and an adventure travel company, Abercrombie & Kent.But even with the sale recommendation, Pirate Capital, which holds 13 percent of Intrawest’s shares, is not taking a strong stance, said analyst William Marks of JMP Securities.”This is actually a fairly friendly shareholder,” he said. “They own enough [stock] to make it known what they want to do, and people listen.”The hedge fund “bought the stock because it believes Intrawest is a good value,” Marks said. “And it continued to buy the stock as it rose because it believes it’s a good value at $30, even $35.”Intrawest announced in March that it hired Goldman Sachs to help the company review its options, including a possible sale or merger. Intrawest did so “because it agrees with Pirate that the shares are undervalued,” Marks said.Intrawest is primarily looking for a financial partner that will allow the firm to expand and achieve growth goals, O’Connor said. “We’re just testing the waters right now.”Marks said Goldman Sachs is likely working on a package that details the company and offers advice as to whether the company should be split up or sold, or whether it should buy back stock or pay off debt, he said. “Key strategic and financial decisions” loom for the company, Marks added. Chad Abraham’s e-mail address is chad@aspentimes.com


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