Intrawest reaches agreement with creditors and postpones auction
Tuesday, March 2nd, 2010Ski resort operator Intrawest has landed on steady financial footing after two weeks of negotiations between its owner and creditors that took place even as Olympic games were held on the slopes of its flagship Whistler Blackcomb ski resort.
Fortress Investment Group LLC, a New-York based hedge fund that owns Intrawest, has reached an agreement in principle with creditors to restructure the debt owed and avoid an auction of the company’s properties.
Intrawest was said to be slated for the auction block Monday. The auction has twice been pushed back from Feb.19 after creditors posted a notice in newspapers last month saying that a foreclosure process was to begin.
The new deal will allow Fortress to inject an additional US$150 million of equity into the business to pay down debt and retain control of the resort company.
A new $1.2-billion loan package will extend debt maturities by as long as four years and will charge a higher interest rate than for existing debt.
Fortress took on the debt to buy Intrawest in 2006 in a $2.8-billion leveraged buyout during the height of the real-estate bubble, but missed payments in December on a US$1.4-billion loan.
The deal is now an agreement in principle and the parties have set an April 16 deadline to complete the negotiations.
