Talisker owns the upper mountain land upon which most of Park City Mountain Resort operates. (photo: FTO/Marc Guido)

Vail Resorts Offers to Buy Park City Mountain

Park City, UT – In the latest maneuver in a tangled and sordid battle for control of Park City Mountain Resort (PCMR), Vail Resorts has offered to purchase the base area of PCMR from current owner Powdr Corp., the ski resort’s current operator.

In a letter addressed to Powdr CEO John Cumming dated yesterday and released to the local press, Vail Resorts CEO Rob Katz offered “fair market value for any of the assets you have that would be helpful to us in operating the resort.” Katz offered to allow independent appraisers to determine what “fair market value” is.

This whole tangled mess arises out of a land lease dispute. Talisker Land Resolution, the owner of the majority of the land leased to Powdr to operate the popular Utah ski resort and a division of Canyons Resort owner Talisker Corp., alleges that Powdr failed to provide timely notification of its intention to renew the lease in April 2011. Powdr, on the other hand, maintains that between 2009 and mid-2011 they provided Talisker with repeated declarations of their intent to operate the resort through 2051.

After Talisker advised Powdr in December 2011 that they considered the lease expired, in March of 2012 Powdr filed suit in Utah District Court to enforce the lease renewal. In May of 2013 Talisker Corp. reached an agreement to allow Vail Resorts to operate Canyons Resort under a long-term lease, with a provision that allowed Vail Resorts to include the lease between Talisker Land and Powdr for PCMR without any additional consideration. In essence, after declaring Powdr’s lease null and void, Talisker found a new tenant in Vail Resorts who was willing to pay a much higher rent, even though Powdr maintained its presence on the lease holdings.That allowed Vail Resorts to take Talisker’s place in the pending litigation.

Talisker owns the upper mountain land upon which most of Park City Mountain Resort operates. (photo: FTO/Marc Guido)
Talisker owns the upper mountain land upon which most of Park City Mountain Resort operates. (photo: FTO/Marc Guido)

No matter the outcome of the litigation, many observers presume that following any verdict some sort of buyout would need to take place, as Talisker owns the land for most of the ski area while Powdr owns the base area. It would be difficult, if not impossible for one to function without control of the other, at least until Vail Resorts is able to complete its desired “interconnected  ski  experience” between Canyons and PCMR.

Should Powdr lose the lawsuit and block access to the ski area through its base holdings, “There  are  numerous  ways  that  this  terrain  can  be  potentially  used  for  skiing,  particularly  since  the  land  is  immediately  adjacent  to  Canyons  and  the  two  can  be  easily  connected  with  a  new  chairlift,” Katz wrote, even though that sort of action by Powdr would effectively separate PCMR from the vibrant ski resort town of Park City.

“Unfortunately,  despite  the  relative  ease  with  which  it  could  be  done,  Canyons  and  Park  City  have  never  been  able  to  complete  such  a  connection,” Katz continued. “Our  Company  hoped  to  be  a  part  of  the  effort  to  make  it  happen.”

Katz’ letter attempted to put the blame for the current strife over PCMR’s future squarely on the shoulders of Powdr Corp.

“Everyone at Vail Resorts is very cognizant of how difficult this has been for PCMR, its employees, its guests, its partners and the Park City community,” Katz wrote. “But, if PCMR should lose its lease, PCMR alone needs to take responsibility for that outcome.”

In a prepared statement released on Tuesday afternoon, Cumming rejected Vail’s latest attempt at what he deems to be a hostile takeover of PCMR.

“We have repeatedly made it clear to Vail that PCMR is interested in exploring all possible solutions that will preserve the independence of PCMR as the nation’s premier family ski resort. What we won’t agree to is a Vail takeover,” Cumming stated. “Vail’s domination of the ski market in Summit County (Utah) would be bad for our community, bad for our guests, and bad for our employees.

“If Vail and Talisker are interested in having a public discussion about their negotiation strategy, they should be willing to disclose documents to the public. PCMR has sought to make this information public, including Talisker’s takeover proposal, only to have such requests blocked by Vail and Talisker in court.

“People should not be swayed by Rob’s attempt to try the merits of this case in the press,” Cumming concluded. “We will present our arguments to the court beginning next week.”

Should Vail Resorts prevail in court, Katz made clear his company’s intention to occupy and operate PCMR.

“If  a  Court  ultimately  rules  that  PCMR’s  lease  with  Talisker  was  renewed,  then  PCMR’s  belief  in  its  case  and  its  numerous  public  assertions  will  be  upheld  and  I  would  assume  that  PCMR  will  be  able  to  continue  to  operate  on  Talisker’s  land  for  the  foreseeable  future.    If  this  is  the  outcome,  I  will  offer  you my  sincerest  congratulations,” Katz wrote.   “Our  Company  will  also  remain  very  interested  in  continuing  to  work  with  PCMR  on  opportunities  to  create  a  better  guest  experience  at  our  respective  resorts.

“However,  if  a  Court  ultimately  rules  that  PCMR’s  lease  has  expired, then  Vail  will  become  Talisker’s  tenant  on  that  land  and  it  is  absolutely  our  intention  to  utilize  and  operate  that  terrain,  which  was  Talisker’s  intent  in  leasing  it  to us.”

District court hearings are scheduled for April 3 and 8 to decide several key legal issues ahead of the upcoming trial that will ultimately determine the outcome of PCMR.

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