Apollo dissolves Vail Resorts stake

VAIL, Colo. — Vail Resorts Inc. Thursday said one if its largest shareholders, the investment firm that took the company public in 1997, is dissolving its stake.

Investment firm Apollo Advisors, which owns 17.8 percent of Vail Resorts, is converting its 6.1 million Class A shares — representing virtually all of Vail Resorts' Class A stock — into common shares.

The Class A shares conveyed the right to elect up to two-thirds of Vail's board.

Apollo's common shares will be distributed to its limited partner investors, the company said.

Vail Resorts also said that with the change in its stock structure, it is reducing the size of its board to seven members from 12. Five of its 12 directors resigned Monday. Two of the remaining directors are affiliated with Apollo.

Vail Resorts will also stop paying New York-based Apollo an annual management fee.

In a statement, Adam M. Aron, Vail Resorts chairman and CEO said, "We are very grateful for the leadership provided by Apollo since 1992. The company took many steps over the past decade to further establish its position as the premier mountain resort operator in North America."

Shares of Vail Resorts closed Thursday at $18.07, down $1.01, or 5.3 percent, on the New York Stock Exchange.

Separately, Vail Resorts reported a loss of $36.3 million, or $1.03 a share, for the fourth quarter ended July 4, wider than the loss a year ago of $33.7 million, or 96 cents a share.

Revenue for the latest quarter rose 4.2 percent to $83.1 million from $79.7 million.

For the full fiscal year, Vail Resorts lost $5.9 million, or 17 cents a share, compared with a loss of $8.5 million, or 24 cents a share, a year earlier.

Full-year revenue rose to $500.4 million from $464.1 million.

Vail owns and operates Vail, Beaver Creek, Keystone and Breckenridge ski areas in Colorado, Heavenly in Nevada and California, and Grand Teton Lodge Co. in Jackson, Wyo.

During a conference call to discuss the results, CEO Aron said reports in the media about the possible sale of the company were "inaccurate" and some of the "sources in the stories were either stupid . . . or making things up."

The Denver Post reported in July that Vail Resorts was courting buyers interested in acquiring the company for about $725 million.

Aron said he couldn't elaborate because his lawyer advised him not to comment on market speculation.

"I've said it as clearly as I can — the management team and everyone in the company is focused on operating the business," Aron said.