Department of Justice investigating antitrust issues with Alterra’s plan to buy Arapahoe Basin (2024)

The Department of Justice is taking a closer look at Alterra Mountain Co.’s planned acquisition of Arapahoe Basin ski area.

The department has requested information from the ski area and the 18-resort Alterra Mountain Co., as well as annual surveys and studies of the resort industry conducted by Boulder’s RRC Associates for the National Ski Areas Association.

“It’s taking time,” said Alan Henceroth, the longtime boss at Arapahoe Basin, who described the information requested by the federal government as demographics of visitors, visitation numbers, financial information and “all the business issues” involving the ski area.

Alterra Mountain Co., which owns the Steamboat ski area and operates the city of Denver-owned Winter Park ski area, in February announced its plan to buy the 1,428-acre Arapahoe Basin from Dream Unlimited Corp, the Canadian real estate investment trust that has owned the Summit County ski area since 1998.

The Justice Department served the National Ski Areas Association and market research firm RRC Associates with civil investigative demands earlier this month. The inquiries seek data from RRC’s annual surveys of U.S. ski areas, including the NSAA’s yearly Kottke Report as well as demographic and economic analyses of the resort industry. In a letter to NSAA’s member resorts in the Rocky Mountains, the association on June 26 said it had worked with the federal government to narrow the scope of its inquiry to just ski areas in the association’s six-state Rocky Mountain Region.

The letter, first reported by Matthew Scott with the website Snowology, promised that NSAA was “determined to maintain the strictest confidentiality” in providing the information “to ensure that the information is used for the good of all the membership.” The annual reports are not available to the public.

“We are assured that the Department of Justice is bound by statute to maintain the confidentiality of this data as well, and they have further represented to us that none of it should ever be disclosed in any public document or forum,” reads the letter from NSAA sent to select members.

The U.S. Attorney General’s Office in Colorado declined to comment on the inquiry. RRC Associates declined to comment as well. Executives with the National Ski Areas Association did not immediately return emails or texts Thursday.

Alterra Mountain Co. emailed a statement saying a filing with the Justice Department was “customary given the size of the transaction.”

“We are working through the process, but we cannot otherwise comment on the state of the ongoing review with the DOJ,” reads the statement. The company declined to say if its previous acquisitions since forming in 2018 have been investigated by the Justice Department.

But it is not the first time that the federal government has had antitrust issues with ski area consolidation in Colorado.

The Colorado attorney general and the Department of Justice’s Antitrust Division in 1996 sued in U.S. District Court in Denver seeking to block Vail Resorts’ acquisition of Arapahoe Basin. Vail Resorts in 1996 announced a $310 million deal to buy Breckenridge, Keystone and Arapahoe Basin ski areas from Ralston Resorts, Inc. The civil lawsuit forced Vail Resorts to sell Arapahoe Basin to a Canadian real estate firm that became Dream Unlimited.

The suit filed by the federal government in 1996 argued that Vail Resorts’ acquisition of Arapahoe Basin would have “lessened competition substantially in the Front Range skier market.” In 1996, Ralston’s three Summit County ski areas accounted for 26% of visits from Front Range skiers, and Vail Resorts’ Vail and Beaver Creek ski areas in Eagle County accounted for about 12% of Front Range skier traffic.

Vail Resorts selling Arapahoe Basin “will prevent Front Range skiers from paying higher lift ticket prices,” reads a January 1997 statement from the Department of Justice.

Arapahoe Basin was the first ski area not owned by Vail Resorts to join the company’s Epic Pass. The ski area offered unlimited access to Epic Pass skiers from 1998 to 2019, but the resort’s parking lots were overwhelmed with crowds and Henceroth dropped the Epic Pass for Alterra Mountain Co.’s Ikon Pass partner program, offering skiers either five or seven days of access.

Henceroth earlier this week told his loyal skiers that Ikon Pass access for the 2024-25 ski season would remain at five and seven days. There are 12 ski areas within a couple hours drive from Denver and eight of those ski areas are available to skiers using the Epic or Ikon passes. And those eight — Arapahoe Basin, Beaver Creek, Breckenridge, Copper Mountain, Eldora, Keystone, Vail and Winter Park — easily host more than half of Colorado’s annual skier visits.

While the Department of Justice review is delaying the deal, Henceroth said the Forest Service is reviewing the transfer of Arapahoe Basin’s special use permit to Alterra Mountain Co.

The Forest Service review is going well, Henceroth said, but it can’t be finalized until the Justice Department completes its analysis.

“Once the Department of Justice is done, I think the closing will happen very quickly,” he said. “I know Dream is ready to get it done.”