An Alberta judge approved a deal last month that will rescue Resorts of the Canadian Rockies from liquidation and keep the companys assets intact.
The rescue package, offered by Calgary financier Murray Edwards, will provide an immediate infusion of $5 million to keep the company operating until the end of the month.
The plan also consists of another $75 million in new equity and includes the assumption of mortgages and leases.
RCR consists of eight ski areas in British Columbia, Alberta and Quebec, including high-profile resorts such as Fernie and Lake Louise. The companys holdings also consist of golf courses and real-estate developments.
The Calgary-based company has been under court protection since last March after the combination of a poor ski season and the withdrawal of a major U.S. lender led to a cash crunch. RCR owes creditors $148 million and has assets worth $160 million.
A rival bid made by the Ottawa-based owners of Quebecs Camp Fortune ski area was dismissed by the judge after they requested the vote be postponed to give them more time to prepare a competing offer.
According to the National Post , RCR is hemorrhaging $1 million a week.
The rescue package is quite complex and involves 15 companies related to current RCR owner Charlie Locke.
Major creditors the Bank of Montreal and an American financial company are owed $55.6 million and will be repaid in full, while a pool of $6 million will be divided among unsecured creditors.
Small creditors owed less than $1,500 will be paid in full and the remainder will receive somewhere between 20 and 25 cents on the dollar. Creditors will vote on the deal this month.
Under the plan, RCR will be acquired by a company to be known as Resorts 2001. Edwards will control all the properties while Locke will continue to run the operations.
Edwards has stakes in a number of oil companies and is a co-owner of the NHLs Calgary Flames. He is worth an estimated $500 million.
The eccentric Locke started building his ski-resort empire in 1974 after buying into the Lake Louise ski area. Over the last five years his holdings have expanded rapidly.
RCR is North Americas largest privately owned ski-resort operator and sees more than two million annual skier visits.
The company also owns Kimberley in B.C.; Nakiska, Fortress and Wintergreen in Alberta; and Mont-Sainte Anne and Stoneham in Quebec.