Dream Unlimited Corp. (DRM-T) has announced the pending sale of one of its longest-held and most iconic U.S. holdings, the Arapahoe Basin ski resort in Colorado, to U.S.-based resort operator Alterra Mountain Company.

Neither company has released financial details of the transaction, but Dream said the purchase price is a “modest premium” to the resort’s fair market value as of Q3 2023. Dream did say in Monday’s announcement it expects an after-tax profit of approximately $110 million from the sale, before closing costs and adjustments.

The sale remains subject to a number of conditions and regulatory approvals, but is expected to close prior to the end of 2024.

“Arapahoe Basin has been a great investment for Dream and one that we are very proud of,” Michael Cooper, Dream’s chief responsible officer, said in the announcement.

“We have had the honour of taking care of this resort over the last quarter-century, with a constant commitment to the visitor experience. We are thrilled that Alterra recognizes and shares the same values and will continue to foster its unique and incredible culture. 

“As part of our capital management and allocation strategy, we decided it was a good time to crystallize the investment to further increase our liquidity. We look forward to further discussing the transaction on our Feb. 21st earnings call.”

Dream and Arapahoe Basin

Dream acquired Arapahoe Basin in 1997, and during its 27 years of ownership has expanded the skiable terrain from 490 acres to the current 1,428 acres.

It has also made significant investments, replacing all the lifts and most of the buildings, while also opening what it says are the two highest-elevation restaurants in North America, Il Rifugio and Steilhang Hut.

Dream says Arapahoe Basin’s ski lifts infrastructure is, on average, the newest in North America.

During Dream’s ownership, the management team also increased skier days from under 200,000 skiers to about 600,000 skiers.

In 2023, Ski Magazine ranked the ski area No. 12 on its list of the best resorts in the West (North America). 

Dream plans to use proceeds from the sale to repay debt and maintain “financial flexibility.”

It is also considering returning a portion of the proceeds to shareholders and evaluating other investments within the company “to maximize shareholder value and increase liquidity.”

Known locally as A-Basin, the resort is located about 100 kilometres from Denver and boasts the longest season in Colorado, sometimes extending to July 4.

According to Alterra, the A-Basin property sits on the Continental Divide in the Rocky Mountains and offers some of North America’s highest-elevation and most-challenging terrain.

Alterra's plans for Arapahoe Basin

“Arapahoe Basin is considered legendary for a reason. From its unparalleled terrain, to its commitment to sustainability, A-Basin has a team that has a passion and commitment for this unique place and its traditions, making it an ideal fit for the Alterra Mountain Company family,” Jared Smith, president and CEO of Alterra, said in its own announcement.

The management team, including COO Alan Henceroth, is to remain in place to oversee daily operations as well as Alterra's capital improvement plans, which include expanding parking and snowmaking.

“A-Basin has a long-time and loyal following among skiers and riders in Colorado and we care deeply about the culture of A-Basin that brings them back,” Henceroth said in Alterra’s announcement.

“We have worked with Alterra Mountain Company since 2019 when we joined the Ikon Pass community (a pass which offers access to about 50 U.S. and international resorts), and we have every faith that Alterra is committed to helping us maintain A-Basin’s authenticity.”

In 2018, A-Basin pledged to be carbon neutral by 2025 and recently made a major step toward that goal by officially using 100 per cent renewable electricity.

The addition of Arapahoe Basin will bring Alterra’s portfolio to 18 year-round mountain destinations throughout North America.

About Dream and Alterra

Dream, a Toronto-based developer of office and residential assets, owns stabilized income generating assets in both Canada and the U.S., and has an established asset management business.

It has $24 billion of assets under management across four TSX-listed trusts, a private asset management business and numerous partnerships. It also develops land and residential assets in Western Canada. 

Alterra Mountain Company owns and operates 17 year-round resorts, the world’s largest heli-skiing operation, and Ikon Pass - a ski and snowboard season pass offering access to more than 50 mountain destinations around the world. 

Headquartered in Denver the company’s portfolio includes properties in seven U.S. states and three Canadian provinces: Steamboat and Winter Park in Colorado; Palisades Tahoe, Mammoth Mountain, June Mountain, Big Bear Mountain Resort and Snow Valley in California; Stratton Mountain and Sugarbush Resort in Vermont; Snowshoe Mountain in West Virginia; Tremblant in Quebec; Blue Mountain in Ontario; Crystal Mountain in Washington; Schweitzer in Idaho; Deer Valley Resort and Solitude Mountain Resort in Utah; and CMH Heli-Skiing & Summer Adventures in British Columbia. 

Also included in the portfolio is Alpine Aerotech, a worldwide helicopter support and maintenance service centre in British Columbia;, Aspenware, the ski industry technology and e-commerce service; and Ski Butlers, a global ski and snowboard rental provider.