Starwood Takes Majority Stake in Mammoth
SAM Magazine-Mammoth Mountain, Calif., Oct. 5 2005-Starwood Capital Group Global, L.L.C. is taking a majority interest in Mammoth Mountain. The transaction values Mammoth at $365 million. Rusty Gregory will retain his position as chairman and CEO of Mammoth Mountain, and will continue to own a substantial stake in the company. Intrawest will also maintain a minority investment. The deal is expected to close within 90 days.
Starwood Capital has also entered into a preliminary agreement with Intrawest to form a joint venture to recapitalize and develop the majority of Intrawest's real estate holdings in and around the Mammoth Lakes region. The joint venture plans to develop more than 1,000 residential and lodging units and approximately 30,000 square feet of commercial space. According to Starwood, it will become the single entity responsible for most of the key real estate development in and around the Mammoth Lakes region-unifying development of the bed base and the amenities that are crucial to developing a destination resort.
In reducing its stake from 59.5 percent to 15 percent, Intrawest expects to realize a pre-tax profit of about $101 million, which it will initially use to pay down debt as it evaluates other ways to put the money to work.