Steamboat Springs American Skiing Company announced Tuesday it has successfully renegotiated the terms of its senior loan of $165 million but withheld the details of the terms.
The news means the parent company of the Steamboat Ski Area has purchased more time in its bid to turn its financial fortunes around. But it's not out of the mogul field yet.
Company officials declined to comment this week on their efforts to sell the Steamboat Ski Area, part of a major restructuring plan. And they confirmed that real estate closings at the Steamboat Grand hotel are frozen while the settlement of a lawsuit is worked out.
American Skiing announced June 29 that it had received an extension until July 9 to finalize the details of amendments to its $165 million resort senior credit facility. At the time, it said it had reached agreement on those terms in principle with Fleet Boston. That bank is the lead lender in a syndicate of institutions holding the ASC note. However, ASC sought more time to reach agreement with the remaining members of the lending syndicate. Now, the company says those negotiations are final.
Restructuring of the resort loan is just half the picture, however. The company is also negotiating for more favorable terms on its real estate loans. The company has two division one on the resort side and the other on the real estate side.
Chief Financial Officer Mark Miller said ASC remains encouraged by progress made in negotiations with lenders to the company's real estate subsidiary and is close to completion of a new infusion of capital.
ASC's Vice President for Corporate Communications Skip King said there are no external deadlines for completion of the restructuring process for real estate debt, and that process is open-ended.
"The amended (resort) facility lays the groundwork for completing the other aspects of the company's financial restructuring package, so this is a major development in completing our objectives," Miller said in a prepared statement.
He said he won't release the details until the overall restructuring package is complete, he added.
A major portion of the corporate restructuring involves plans to sell the Steamboat Ski Area and other assets in Steamboat, including the Steamboat Grand hotel. King declined Tuesday to discuss what phase the effort to sell Steamboat is in.
"We realize the sale (of the Steamboat Ski Area) is a matter of intense scrutiny in your town," King said. "But we are not going to say anything about it until we have something to announce."
King confirmed that ASC is not closing any sales at the Steamboat Grand pending final resolution of a foreclosure suit filed by the hotel's general contractor, Colorado First/PCL.
ASC has not closed any sales of the hotel, which is being sold on a quarter-share basis, since mid-May, roughly corresponding to the time ASC said it was finalizing a settlement with the general contractor on the hotel. Colorado First/PCL filed a foreclosure suit in District Court here on May 4, seeking more than $5 million in damages. CFC/PCL claimed it was owed more than $11 million from the hotel construction, a $70 million project.
King said that the final resolution of PCL's claim against ASC is one component of ASC's entire restructuring package.
ASC officials said in April that continuing sales of Steamboat Grand quarter shares are important to the company's economic future.
Chief Operating officer Hernan Martinez said sales at the Steamboat Grand are too significant a part of the company's plan to restructure itself and get out from under debt to simply let them stagnate while waiting for a sale to move forward.