Vail Resorts Take Over Andermatt Ski Area in Switzerland

FacebookTwitter

Vail Resorts Take Over Andermatt Ski Area in Switzerland

Started by J2SkiNews in Ski News - 4 Replies

Login
To Create or Answer a Topic
Vail Resorts Take Over Andermatt Ski Area in Switzerland

J2SkiNews posted 28-Mar



Vail Resorts, the world's largest ski resort operator, has bought a majority share in the company that operates Andermatt ski area in Switzerland.

Andermatt has been transformed over the past decade with an investment of over 1 Billion Swiss Francs by a group led by an Egyptian billionaire, Samih Sawiris, building property and totally overhauling the ski area with fast new lifts.

This resort operating business has now sold a 55% stake to Vail Resorts, which already operates 40 resorts in the US, Canada and Australia, for 149 Million Swiss francs.
"Entering the European ski market has been a long-term strategic priority for Vail Resorts. We are excited to be partnering with ASA and investing our capital and resources to support Andermatt-Sedrun's transformation into a premier destination resort," said Kirsten Lynch, Chief Executive Officer of Vail Resorts.

www  The Snow Hunter

SwingBeep
reply to 'Vail Resorts Take Over Andermatt Ski Area in Switzerland'
posted 04-Apr

Samih Sawiris never intended to run the ski area. Originally the plan was to get the Swedish ski area operator Skistar to run it, but due to delays they pulled out and eventually invested in St. Johann in Tyrol, which doesn't appear to have worked out as they recently pulled out.

Of the 149 million Swiss Francs 110 million will be used to install more snow making equipment, replace older lifts in the Sedrun sector and modernise the restaurants. Not all of the projects approved in 2013 have been completed yet. In return for this Vail Resorts will get a 55% stake in Andermatt-Sedrun Sport AG, the company that operates the ski area, the ski school and the Gleis 0 sports shop.

The other 39 million will go to Andermatt Swiss Alps AG, the company that owns the hotels and apartment blocks in Andermatt Reuss and the golf course, Vail Resorts won't be getting anything in return for this payment. This will enable Sawiris to build more property, due to the Covid-19 pandemic there has been a surge in demand for property in the mountains, as Andermatt Reuss is exempt from Switzerland's laws on foreign ownership and second homes he will probably be able to sell property faster than he can build it.

It will be interesting to see how Vail Resorts gets on, they won't be able to operate the ski area in the same way as they operate their American resorts, Switzerland's hospitality and ropeway sectors are highly regulated and as soon as they propose any expansion of the ski area they will be hit by a load of objections from the environmental organisations.

Other foreign companies have invested in Swiss ski areas, but have for the most part failed. The Compagnie des Alpes bought stakes in Verbier and Saas Fee in 2000 / 2001 but pulled out less than 10 years later. In 2014 a Czech billionaire property investor bought a 51% stake in the Crans Montana lift company, but soon fell out with the locals, rumour has it that he wants to lease the area back to the local council.

J2SkiNews
reply to 'Vail Resorts Take Over Andermatt Ski Area in Switzerland'
posted 06-Apr

Thanks as always Swingbeep. It does seem an odd move by Vail Resorts as I think they're usually fairly savvy and clinical with their purchases. It's hard to see how they're going to get much back on a fairly large chunk of cash even by the scale of the amounts of money these corporations spend these days. I believe their Epic Pass product, and getting more people to buy it, is a crucial part of their business plan so perhaps they envisage a carrot (discounted pass?) and stick (price rise on normal lift ticket) for captive market of Andermatt property buyers to move them on to that? I think that's one of the complaints in resorts like Whistler that they've taken over - locals who only want to ski Whistler have to buy an Epic pass costing considerably more than their old season pass used to (they say...). But would Swiss law stop that being something Vail could do anyway?
www  The Snow Hunter

SwingBeep
reply to 'Vail Resorts Take Over Andermatt Ski Area in Switzerland'
posted 07-Apr

Your welcome J2Ski news. It does seem a bit odd especially as the deal doesn't seem to include any property in the Andermatt Reus development, only around 50% of Vail resorts income comes from the sale of lift tickets. The 110 million only covers the cost upgrading the infrastructure in Sedrun sector, upgrading the Gemsstock sector has not been mentioned. The construction of 4 new lifts in the Gemsstock sector was foreseen in masterplan (to date only 1 has been built) and a 3S gondola feeder lift from to Göschenen to Gütsch is also planned. These will have to be financed at some point so it is indeed "hard to see how they're going to get much back".

70% of the apartments sold to date have been bought by Swiss people and a lot of them are rented out, any owners able to spend enough time there to make a season pass worthwhile will certainly buy the Epic Pass as it's about 40% cheaper than the current season pass.

A lot of European skiers who only ski for a week or two each season are very price sensitive, if the feel that a lift pass is overpriced they will go elsewhere. I don't think there is anything in Swiss law that would prevent them putting up the price of lift passes, but if they increase the price of the lift passes to the same level as they have in their US resorts Swiss and other European skiers will simply go somewhere else, there's lots of choice.

As US tourists only accounted for 2.5% of Andermatt's overnight stays in 2019, there should be some scope for increasing the numbers by adding Andermatt to the Epic Pass.

J2SkiNews
reply to 'Vail Resorts Take Over Andermatt Ski Area in Switzerland'
posted 08-Apr

SwingBeep wrote:As US tourists only accounted for 2.5% of Andermatt's overnight stays in 2019, there should be some scope for increasing the numbers by adding Andermatt to the Epic Pass.


Thanks again - agreed on this last point, but then they already have big name European resorts as partners and included on the pass. I suppose membership might be more unlimited now they own the ski lifts (non-Vail resorts seem to have a limit of a week of pass use on their slopes each season). I was told recent years have seen more Australian skiers than British ones at resorts in the US after Alterra and Vail bought half of the main resorts there between them. So Aussie skiers buying Epic/Ikon passes to ski Aussie slopes can now ski North American resorts for no extra cost. Just the minor matter of crossing the Pacific, paying for lodging etc...
www  The Snow Hunter

Topic last updated on 08-April-2022 at 16:21

Not a Member?

FREE Snow Reports by e-mail.

Save on Ski Hire

Save up to 50%

+5% for 4+ Ski Packs

+10% for 10+ Ski Packs

Discount Ski Hire

7th day Free on selected dates

Ski Hire Shops in Verbier and Andermatt.

SkiSet

Sponsored Links

July 7, 2022

There is no snow forecast for United States. To view the latest weather predicted for American Ski Resorts, see below.

Forum Listing Key

Unread Post
Hot Topic
Sticky (important)
Announcement

The views and opinions presented in the J2Ski Forums are solely those of their respective authors and do not represent those of J2Ski Ltd. Objectionable Content may be notified by sending a Private Message to Admin.

J2Ski logo J2Ski logo