Fortress holding on to Intrawest 

Agreement apparently reached with lenders to restructure debt

Fortress Investment Group has successfully staved off an auction for Intrawest, say reports quoting anonymous sources.

Bloomberg reported on Saturday, Feb. 27 that Fortress Investment Group LLC, the owner of Intrawest, has reached a deal with lenders to restructure the company's debt, though it did not identify its sources.

The story said that Intrawest's $1.2 billion in debt would be divided into separate portions of $800 million and $400 million, with an April 16 deadline to complete negotiations.

A source close to the negotiations found nothing to dispute in the Bloomberg report, nor a similar report in the Wall Street Journal , which stated that Fortress must inject an additional $150 million into Intrawest in order to increase its equity in the company.

Bloomberg additionally said that two Fortress-backed funds put $345 million into the company in 2008 to satisfy lenders.

Another source close to the situation said the auction is off and that the Province of British Columbia has been in talks with some interested parties. Whistler Blackcomb, one of Intrawest's top assets, leases its mountains from the provincial government. The source also said that Nippon Cable, owner of 23 per cent of Whistler Blackcomb, may be looking to increase its stake in the company.

Officially, Intrawest said it is still in discussions with its lenders, which include Davidson Kempner, Lehman Brothers Holdings and Oak Hill Advisors. It was the same statement the company has been sending out since late January.

The apparent deal ends weeks of speculation about the ski company that almost faced an auction in the middle of the Olympics.

On Jan. 19, lenders that helped Fortress buy Intrawest served public notice that they would be holding an auction on Feb. 19 for a major stake in Intrawest Holdings S.à.r.l., a company subsidiary that holds all of its resorts.

The auction was later postponed a week, with some saying it was to take advantage of good weather and better public relations for the 2010 Olympic Games. The first days of the Olympics were mired in bad news with the death of a Georgian luge athlete and poor weather that required the postponing of the men's downhill.

Now, the auction has been averted altogether, so ownership of Intrawest will not change - at least not until further notice.

The auction was announced as Intrawest began selling off a number of its assets. In November the company announced that it had sold Copper Mountain in Colorado to Utah-based Powdr Corporation. Though it never made the figure public itself, the transaction was believed to be worth about $100 million.

Intrawest later sold Panorama Mountain Resort near Invermere to a group of investors from the Kootenays. It then sold off the Village at Squaw Valley to Squaw Valley USA, operators of the California resort, and Florida's Sandestin Golf and Beach Resort to the Becnel family of Destin, Florida, which operates resorts, luxury condos and townhomes in the city there.



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