The court-appointed receiver overseeing Jay Peak Resort gave a fresh look Friday at last week’s auction of the ski area, and he won the approval he was seeking to sell to the highest bidder.
The receiver, Michael Goldberg, also revealed that another Vermont property under his control, Burke Mountain Resort, could soon be sold.
Both ski resorts were owned by Ariel Quiros and had been implicated for years in the biggest fraud case in state history.
Goldberg said in a court filing last week that Pacific Group Resorts Inc., of Park City, Utah, offered $76 million for Jay Peak, which has been in receivership for more than six years.
Pacific Group Resorts had made an initial bid of $58 million for Jay Peak, according to court documents from before the auction.
Goldberg had provided little information about the one-day closed-door auction, without even revealing the number of other bidders who participated.
However, during a Friday morning hearing to approve the station’s sale, Goldberg gave some insight into what happened at the auction. The hearing was conducted via video from the US District Court in Miami.
According to Goldberg, two other bidders, whom he did not identify, participated in the auction, offering initial bids of $60 million and $61 million.
“There were about 48 separate betting rounds,” he told the judge.
Goldberg told the judge that after a bond of about $5.2 million for sewers the station is set to pay, along with brokerage fees and other fees associated with the transaction he expected. to earn about $70 million from the sale. These funds would then be distributed to defrauded Jay Peak investors.
“We expect the distribution, or I will, (based on a) preliminary estimate on the back of a napkin to Jay Peak’s creditors, the investors, to be approximately 40 cents on the dollar , your honor,” the receiver said. said.
Goldberg said he would provide the court with the exact numbers after the sale closes, which is expected to take place around October 15.
Pacific Group Resorts owns a handful of other ski areas in the United States and Canada, including Ragged Mountain in New Hampshire and Powderhorn Mountain Resort in Colorado.
Jay Peak Resort is valued on Jay’s big city list at around $85 million, having been valued at $121 million in 2020 but reduced following a challenge from resort officials.
Quiros, the former owner of Jay Peak, as well as Bill Stenger, the former president of Jay Peak, and William Kelly, one of their advisers, are all in federal prison.
State and federal regulators began legal action against Quiros and Stenger in April 2016, placing the resort in receivership. Regulators have accused the pair of embezzling $200 million of the more than $350 million they’ve raised from foreign investors for massive upgrades to the ski resort through the federal EB-visa program. 5.
These enforcement actions were resolved by financial settlements with Stenger and Quiros, which included the divestment of his stake in the Jay Peak and Burke stations.
Three years after the civil suit, Quiros, Stenger and Kelly were indicted on federal criminal charges related to a separate project they orchestrated to build a $110 million biomedical research facility in nearby Newport. All three eventually reached plea deals with prosecutors.
Friday’s hearing took place in federal court in Florida, as that is where Quiros lived and many of his businesses were based when the civil suit was filed in 2016.
Goldberg told the hearing that the sale remained contingent on the “assignment” of the state’s leases currently with Jay Peak to Pacific Group Resorts, which he said would not create a problem.
Judge Darrin P. Gayles then approved the continuation of the sale to Pacific Group Resorts. “I note that this is a fair resolution,” the judge said. “It’s actually a pretty good resolution.”
Goldberg also told the hearing that the sale of Burke Mountain Resort may soon be within reach. He did not reveal the potential buyer. Goldberg had testified at a court hearing earlier this year that he was pursuing a deal with Burke Mountain Academy, a world-class ski training school, involving some of its benefactors.
“We are in discussions about a potential sale of this, and we would go through the same process as we did here and bring it before your honor,” Goldberg told the judge on Friday. “Again, we will never take a big step without standing before your honor and gaining your approval.”
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