Yellowstone Club deal would sell resort for $100m
BILLINGS, Mont. - The Yellowstone Club, an exclusive haven for the ultrarich now under federal bankruptcy protection, would be sold for $100 million to a Boston financial firm, under a deal outlined in court documents.
Documents filed by club attorneys show an affiliate of CrossHarbor Capital Partners LLC has agreed to pay $30 million in cash and $70 million in a promissory note for the 13,600 acre club near Yellowstone National Park.
CrossHarbor also has agreed to invest an additional $50 million in capital improvements at the club and $25 million for other expenses.
That $175 million investment comes up far short of prior appraisals of the club, which has been valued at anywhere from $310 million to $780 million.
Club spokesman Bill Keegan said Wednesday that other offers were still being sought. He called the Crossharbor agreement a "benchmark from which to start."
The club counts Dan Quayle and Bill Gates among its 340 members, yet had been only partially developed when it fell more than $400 million in debt last year.
The deal is contingent on court approval and other purchase proposals.
An attorney for creditors still owed money by the club said Wednesday that he was reviewing the CrossHarbor offer.
Thomas Beckett with the Unsecured Creditors Committee said any deal would have to protect members who ponied up deposits of $250,000 to $300,000 to join the club. It also would need to repay the dozens of local contractors and other vendors still owed money.
"The committee will aggressively seek to improve the terms of any plan that doesn't provide for those two goals, and actively oppose it if it can't be improved," Beckett said.
The deal's dollar value aside, it offers a potential exit plan for the Yellowstone Club that would avoid a fire sale of the club's assets.
That prospect was floated earlier in the bankruptcy proceedings by the club's primary creditor, the financial firm Credit Suisse. But it has been fiercely opposed by club members who don't want to lose their mountain retreat, with its gated access and multimillion dollar homes scattered at the base of a members-only ski hill.
In hopes of attracting "higher and better offers" than the CrossHarbor deal, club attorneys on Wednesday asked U.S. Bankruptcy Judge Ralph Kirscher to push back the deadline for the club to come up with its reorganization plan. Now due at the end of March, the plan would not have to be confirmed until the end of April under the attorney's request.
That would give the club time to hold an auction in search of a better offer.
If no better offers are made, the club would ask Kirscher to approve the CrossHarbor deal.
Court documents show a dozen parties have displayed interest in the club, but so far only CrossHarbor and one other party have entered "meaningful acquisition negotiations."
That second party is not named in the documents. An inspection trip to the club was planned by the unnamed party sometime this week, according to the documents.
CrossHarbor is controlled by club member Sam Byrne, who in late 2007 and early 2008 came close to purchasing the Yellowstone Club for a reported $455 million. (AP)