RMOW becomes co-owner of Whistler.com 

After almost a year of closed door negotiations, the municipality has announced a $925,000 deal to buy 50 per cent of Whistler.com Systems.

The deal was made public on Wednesday afternoon.

This means the municipality is now the half owner of the whistler.com Web site, arguably Whistler’s most intuitive Web address.

"We secured this really incredible marketing tool on behalf of the community," said John Rae, manager of strategic alliances and marketing services who was directly involved in the deal.

Though the Web site has been around for more than a decade, it only became a booking engine for Whistler activities and accommodation in November 2000.

"They have a vendor relationship with the vast majority of activity providers and accommodations in the resort," said Rae.

In just three years the site has grown from essentially a start up booking company to a $12 million business.

Its growth has been in the double digits since its first year in operation and conservative estimates point to at least 12 per cent growth annually over the next five years.

"The Internet has become one of the most powerful marketing tools in tourism," said Mayor Hugh O’Reilly.

"And it is imperative that the community is involved in what is clearly the most intuitive Internet address for Whistler."

Projected revenues to the municipality are roughly $500,000 by 2009.

Rae reiterated that these are conservative numbers.

"Five years from now we’ll look back and think it was a bargain," said Councillor Gordon McKeever.

"I think we’ve done an excellent thing here."

Janice Pickwell, who is currently out of the country, owns the company.

She offered a comment on the sale through the municipality’s press release.

"It has long been my view that any sale of the company to an interest other than the community both devalues the URL and limits the community," she said.

"I firmly believe that this new partnership is truly a win-win scenario."

Pickwell approached the municipality a year ago when her co-owner expressed an interest in selling his shares.

Rae said they seized upon the opportunity right away.

"We saw it immediately as an asset that could be worked with for the benefit of the entire community," he said.

But they were also cautious and asked that the negotiations take place privately.

Rae explained they did not want to get into a bidding war should other interested parties find out 50 per cent of the company was up for sale. The municipality wouldn’t be able to compete for long in a bidding war, he added.

Throughout the year the municipality went through a rigorous process of due diligence, keeping council appraised of the developments along the way.

A KPMG study did a valuation of the company and although it was growing exponentially and had revenues of $12 million in the 2003-04 season, the booking engine was still considered a start up company.

And so the asking price came in at $925,000 for half ownership.

Then, one of the most critical steps was an approval from the province. Ultimately the Ministry of Community, Aboriginal and Women’s Services approved the deal.

On the face of it however, nothing much will change with the company and its relationship with Whistler vendors.

"The municipality is not going to be running the business," said Rae.

"There will not be any identifiable changes."

The deal includes the sale of Whistler.com Systems and its affiliate Tourdex.com System.

A shareholder’s agreement will govern the relationship between the municipality and Pickwell and she will remain president of both companies.

The RMOW is also allowed first right of refusal if Pickwell ever wants to sell her share in the future.

The municipality will also have two members on a four-member board of advisors.

This board will decide how to manage operating profits, either reinvesting into the companies, or directing the money to the RMOW’s general fund or paying down the cost of the transaction, said Rae.

Council has already signed the resolution to buy the company he added.

All that remains now is that council must amend the Five Year Financial Plan to reflect the purchase at the next meeting on Monday, May 17.

Comments

Subscribe to this thread:

Add a comment

Readers also liked…

Latest in Whistler

More by Alison Taylor

© 1994-2016 Pique Publishing Inc., Glacier Community Media

- Website powered by Foundation