The three secured creditors for companies behind a delayed Squamish ski resort have made a stalking horse bid of more than $80 million.
Aquilini Development LP, Garibaldi Resort Management Co. Ltd. and 1413994 B.C. Ltd. offered $80.41 million for Garibaldi at Squamish Inc. (GAS Inc.) and Garibaldi at Squamish LP (GAS LP), according to a Jan. 15 term sheet.
The bid includes $73.45 million of GAS debt to the three companies and $5.93 million interest.
B.C. Supreme Court Justice Paul Walker agreed to their proposal Jan. 23 when he gave the green light for the sale and investment solicitation process.
Court-appointed receiver Ernst and Young (EY) began marketing the project Jan. 24 with a closing date no later than April 1. The stalking horse bid sets a floor price for competing bids, but will need court approval if it is deemed the winner.
GAS Inc. was created in 2001 to convert 2,800 hectares of previously logged forest on Brohm Ridge, north of Squamish, into a ski, snowboard and mountain biking resort with related accommodations and amenities. GAS does not own any physical assets. Its primary asset is an interim agreement with the province that gives GAS the right to purse construction and development. It generates no income, instead relying on third-party funding.
GAS Inc. defaulted on $65 million owing to the three Aquilini companies, prompting the September receivership petition, approved by the court in December.
“The funding to this point has primarily supported the development of the resort master plan, advancement of the conditions precedent to the [Environmental Assessment Certificate] and various technical studies to support the development of the resort infrastructure,” said EY’s report to the court.
The 2016-granted EAC was extended in 2021 with a deadline to begin construction in January 2026. Work has not begun and there is no allowance for another extension, meaning it would require a new application.
The project, on Squamish Nation territory, faces 40 pre-construction conditions, eight of which are deemed urgent. They include old growth management, archaeology plan, Brohm River management plan and a dam for a snowmaking reservoir. Work to satisfy the conditions needs to begin in January or February and will cost $5.5 million within the next 12 months.
When it was approved in 2016, the project was estimated at $3.5 billion with a 30-year, four-phase build resulting in 126 ski and snowboard runs, fed by 21 lifts and accommodation in 5,233 hotel, condo, townhouse and detached units.
The project, however, has been hampered by disagreements between factions connected to the Aquilini and Gaglardi families.
“The receiver understands that for some time there has been a lack of consensus amongst Garibaldi’s directors over the direction of the company and the future of the project,” the report said. “This lack of consensus hindered Garibaldi’s ability to raise the funds necessary to support ongoing operations, including the funds necessary to ensure the EAC conditions are satisfied to permit compliance with the EAC deadline.”
The two unsecured creditors are Northland Properties Ltd. and Garibaldi Resorts (2002) Ltd., who are owed $6.37 million and $13.8 million, respectively.
Northland Properties owns Revelstoke Mountain Resort and Grouse Mountain. Founder and chairman Bob Gaglardi is also president of Garibaldi Resorts (2002) Ltd., the company whose secretary is Aquilini Investment Group founder Luigi Aquilini.
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