Management & Tourism
Vail Resorts acquires Crans-Montana
Vail Resorts, Inc. recently announced the successful completion of the contract to acquire Crans-Montana Mountain Resorts from the CPI Property Group (“CPIPG”).
Crans-Montana ranges from 1,500 to 2,900 meters above sea level and, with 140 kilometers of slopes, is one of the top ski destinations in the Alps with spectacular views of the Matterhorn and Mont Blanc.
The Valais ski resort is accessible via five airports and by train, located about two and a half hours from Geneva and less than four hours from Milan and Zurich. Andermatt-Sedrun, also owned by Vail Resorts, is also two and a half hours away.
The Deal
Vail Resorts acquires 84 percent of the ownership shares in Remontées Mécaniques Crans Montana Aminona (CMA) SA, which operates all lifts in the ski area and the associated mountain facilities, including four retail and rental stations.
In addition, the company acquires 80 percent of SportLife AG, which operates the ski schools in the resort. Vail Resorts also fully takes over 11 restaurants located on and around the mountain.
Subject to final adjustments, the valuation for the resort operation is expected to be approximately CHF 118.5 million, including about CHF 7 million in existing debts.
Vail Resorts expects the Crans-Montana Mountain Resort to generate around CHF 5 million in EBITDA in its fiscal year ending on July 31, 2025, the first full operating year after the expected completion later in the fiscal year 2024.
Why Crans-Montana
Crans-Montana has always been a well-known and multiple award-winning destination for fans of diverse outdoor sports. The destination also hosts popular events such as the Ski World Cup, the Mountain Bike World Cup, the Omega European Masters, the Caprices Festival, and many more.
The village also features gourmet restaurants, luxury boutiques, and several 5-star hotels. This includes the recently opened Six Senses Lodge & Spa, a luxury chalet-style hotel with 45 rooms and direct access to the slopes, located above the main gondola of the resort.
“Crans-Montana is an iconic ski destination in the heart of the Swiss Alps with a long tradition and breathtaking scenery. With great passion, the entire team, along with the local population, is committed to a successful region. This enhances the appeal of our offering to owners of our Epic Pass and all guests. We are confident that Crans-Montana and Andermatt-Sedrun have a unique growth opportunity,” says Kirsten Lynch, CEO of Vail Resorts.
Perspective
Thanks to investments and the integration of the Crans-Montana Mountain Resort into the Epic Pass products, Vail Resorts expects significant growth and a larger number of international guests seeking a high-quality experience in the Swiss Alps.
Expectations
The acquisition of the resort aligns with the growth strategy of the American ski resort operator to expand the resort network in Europe.
Over time, Vail Resorts anticipates EBITDA growth through the inclusion of the resort in Epic Pass products, network synergies, and investments in the guest experience.
Subject to the timeline for approval and realization of future projects, Vail Resorts plans to invest approximately CHF 30 million over the next five years as a one-time expenditure to enhance the guest experience.
“Thanks to investments and the integration of the Crans-Montana Mountain Resort into the Epic Pass products, we expect significant growth and a larger number of international guests seeking a high-quality experience in the Swiss Alps,” emphasizes Kristin Lynch.
After these investments and including the effects of additional Epic Pass sales, the resort is expected to generate an annual EBITDA of over CHF 15 million.
Vail Resorts expects that this initial growth phase of the ski resort will be primarily contributed to by operational and marketing initiatives, as well as capital investments to maximize the efficiency of catering and improve and expand snowmaking facilities.
After the completion of the transaction, normal annual maintenance investments for the Crans-Montana Mountain Resort are estimated to be around CHF 3 million.
Planned Knowledge Transfer
Crans-Montana is expected to benefit from the expertise of Vail Resorts, including enhanced data analysis, access to the Epic Pass, and “best practice” experiences from Vail Resorts’ international resorts.
What’s Next?
The transaction is expected to be completed during the ski and snowboard season 2023/2024, subject to certain third-party approvals. The business operation of the Crans-Montana Mountain Resort will continue in the winter season 2023/2024 as usual.
Vail Resorts is committed to retaining the vast majority of employees, existing operational infrastructure, and local expertise. Crans-Montana is set to benefit from the expertise of Vail Resorts, including improved data analysis, access to the Epic Pass, and “best practice” experiences from Vail Resorts’ international resorts.
Vail Resorts is renowned for the Epic Pass, which offers ski and snowboard enthusiasts access to Vail Resorts’ ski areas at an attractive price. Vail Resorts plans to integrate the Crans-Montana Mountain Resort into the Epic Pass from the 2024/25 season onwards.
In the 2023/24 ski season, the Crans-Montana Mountain Resort will not yet be part of the Epic Pass. Currently, the Epic Pass in Europe provides access to Andermatt-Sedrun-Disentis and other European partner resorts, including five days in Verbier 4 Vallées in Switzerland, seven days in Les 3 Vallées in France, seven days in Skirama Dolomiti in Italy, and three days in Ski Arlberg in Austria.
Reactions
David Greenbaum
CEO of the CPI Property Group (“CPIPG”) – Former main owner
“CPIPG is proud of the positive developments that have been made in Crans-Montana over the last 10 years. Vail Resorts has extensive experience in operating ski resorts. We are confident that Crans-Montana will be further strengthened with Vail Resorts.”
Statement
Association of the Municipalities of Crans-Montana (ACCM)
“Crans-Montana looks forward to close collaboration with Vail Resorts, which will undoubtedly create a high-quality guest experience with a clear and long-term vision. Vail Resorts will bring new momentum to the ski area, positively influencing the entire regional economic structure of Crans-Montana. As the new owner of the ski area, Vail Resorts will also have a positive impact on the organization of the FIS Alpine Ski World Championships 2027 in Crans-Montana.”
Kirsten Lynch
CEO of Vail Resorts
“We look forward to supporting the growth, sustainability, and dynamism of the resort and the region with our investments. We place great importance on the guest experience and are committed to collaborating with the community and learning from local partners and the dedicated team of the resort. We share many values with the Crans-Montana community, including our commitment to responsible environmental practices and reducing our operational footprint.”
Bruno Huggler
CEO of Crans-Montana Tourism & Congress
“With the commitment to Crans-Montana, Vail Resorts recognizes the dynamism, innovation, positioning, and strategy of the Valais destination for sustainable tourism throughout the four seasons. Vail Resorts’ in-depth analyses confirm the potential of Crans-Montana as a leading destination in the Swiss Alps. Every effort will be made to promote synergies with all stakeholders in Crans-Montana in the development of tourism offerings, marketing, and distribution. Vail Resorts’ network will be a clear asset for Crans-Montana, especially in the North American market.”
