Utah’s richest man, Cloudflare founder Matthew Prince, believes it is time for Vail Resorts to begin selling off some of its assets and he would like to buy Park City where he grew up skiing and once worked as a ski instructor, according to a Jason Blevins story in The Colorado Sun.
The big problem, Prince says, is the stable of resorts are worth way more than $5 billion and Vail Resorts’ market capitalization — the company’s current share price (around $137, down more than 60% from its 2021 peak) times the number of outstanding shares (around 35.6 million) on the market — that is less than the combined value of all those ski hills. . . “At some point shareholders are going to say you know what, you don’t get to be a capital allocator anymore,” Prince says. “I was hopeful they would come to that conclusion themselves.”
As Prince points out, the issue is that because Vail Resorts’ properties could be worth more than the company they may become a target for corporate raiders who buy the entire company (which Mr. Prince doesn’t want to do) and pay for the purchase by selling off a couple of the big names in Vail’s 42 resort portfolio. The rest could be profit.
It’s a clever angle by a billionaire who wants to own his home mountain, but he may be over-valuing many of the smaller resorts that are literally worth nothing when peeled off from the major label resorts. Either way, more power to Mr. Prince. Anything that breaks up the current resort megacorp monopoly would be. . . epic.
[Link: The Colorado Sun]
