By Polly Mikula
Phill Gross and Michael Ferri are the lead investors buying Killington Resort and Pico Mountain, according to the Aug. 22 announcement. An undisclosed number of additional minority investors will be joining them in the newly created Killington Independence Group, LLC.
The purchase and sale agreement was signed on Wednesday, Aug. 21, 2024, with the deal expected to be finalized by the end of September, pending standard closing conditions and necessary approvals.
So what does this mean for Killington Resort and its community?
“For starters, everything you love about Killington and Pico is staying the same,” stated Killington Resort on its Insider Blog post titled “A new era of independence begins at Killington Resort.”
“Killington season pass offerings will have no changes and we will remain on the Ikon Pass. Guests can expect daily operations to be business as usual, with a continued focus on offering unsurpassed year-round mountain adventure grounded in hosting the longest winter season in the East and hosting the Killington Cup, Nov. 30-Dec. 1, 2024. Killington Resort, the town of Killington and Great Gulf’s partnership will continue to build out the new mountain village. There will be no changes to the leadership, management or front-line teams, ensuring continuity and stability in our operations,” the blog post continued.
“Both of these investors have been in the community for decades,” said Mike Solimano, president and CEO of Killington Resort and Pico Mountain in resort video. “What does this mean for the community? I would say it’s all positive. The staff stays the same, the management team stays the same. Whether you’re a business owner in this community, a season pass holder, or an employee, we’re going to have the resources to continue to improve the resort… we’re going to continue to open early and have really long seasons. We’re looking to have a really smooth transition and the future is bright!” Salimano concluded.
“It’s big news for the mountain, for the people that work there, for the skiers and the community,” said Ferri in an interview Thursday, Aug. 22. “It’s exciting to be involved in it. Phill and my job is really to support what the management team comes up with.”
All the investors have strong ties to Killington and are committed to “building relationships on shared values and goals for the resort, and maintaining the community spirit that’s forged Killington’s identity,” according to a statement from the resort.
All investors are passionate about Killington and have the same goal: “Keep Killington independent and invest in the Resort as if it is our home, because it is,” they collectively stated.
How independent ownership came to be
“A long time ago, when POWDR bought Killington in 2007, they were considering (as part of the slim-down measures) shutting down the Skyeship Gondola,” Phill Gross explained in an interview Thursday. “So I reached out to John Cumming, who’s the head of POWDR (he’s a fellow U.S. Ski Team board member). We started talking about keeping that lift open, which they did… Since then, I’ve kind of been off and on in touch with John… So when the other alternative transactions fell apart last fall, he called me up and said, ‘You know, Killington doesn’t really fit in with our plans, I’d like to sell it to the to the locals (well, actually, he said ‘I’d like to sell it to you’) and I said, ‘I can’t do that, but I’ll try to put a group together to do it.’ And that was the start,” Gross said.
“Phil’s first phone call was to me,” Ferri added. “Phil and I’ve known each other for years.”
In February, Gross and Ferri met Cumming in Utah and they’ve been working to put the deal together ever since.
“In addition to Killington, POWDR is selling three other mountains [Mt. Bachelor, Eldora Mountain in Colorado and SilverStar Mountain Resort in British Columbia] Killington Resort was originally going to be part of that group,” Gross explained. “We really owe a debt of gratitude to POWDR and John Cumming for sticking with the local group. It’s pretty clear that they probably could do better financially if they would go with one of the conglomerates. It’s really, really great that he decided to stick with us,” Gross said.
“POWDR is a big company with different capital constraints and requirements and, you know, their motivation for selling really wasn’t our business, right? It’s their business. It just meant we’ve had the opportunity to do it. They’ve been terrific through all of this,” Ferri added.
Locally funded
“We’ve already raised the capital to close this transaction,” said Ferri. “But we believe now that the word is out, we’re going to get another few phone calls from other people interested.”
“All of the equity investors are Killington families,” Ferri added. “There is no private equity money in this. There’s no third party money. It’s all Killington-vested families, every single dollar. And that was our strategy to begin with. That was our goal… that gives us the ability to execute our vision of reinvesting just about every dollar we make into this mountain through the long term.”
Gross echoed the same plan. “We’re gonna just plow everything back into the mountain for the next decade or so and then see what we have,” Gross said. “I think we’ll have a really valuable asset. There will be a new village, a new Crystal Lodge, a new Bear Mountain Lodge, all the lifts will be upgraded … we’ll see what we have.”
“Phil and my job is to support Solimano and the management team, to provide any resources they may need. It’s really up to them. He [Solimano] knows where the needs are and where it makes sense to invest,” said Ferri.
New village
The local investor group plans to invest profits back into the mountain, “this dovetails nicely with the village coming about,” said Ferri. “They’re about to spend a couple billion dollars to build a village out over the next 10 years, just as we invest our money (or the profits from the mountain) in the infrastructure and the skiing experience and enhancing those — the two couldn’t be timed better!” he said.
“I know it’s been a stop-start scenario for 20 years, but the group that we’ve gotten to know — the people that run Great Gulf — they’re a very big company, very professional, and they have a handle on this, and they’re going to do it,” said Ferri. “They didn’t show up here not to, they’re going to execute this right.”
Gross agreed. “One of the things I don’t think people understand is how likely the village is to be developed by Great Gulf. We would put a 99% probability that that’s all going to happen. Part of our due diligence was looking into that, and we really believe that Great Gulf is the right partner, and they’re going to execute on it. And then the lift plans that we have are absolutely all going to happen as well. So everything’s really in place.
We look at things 10 years out, absolutely everything in the village will be done by then. So we don’t care if it happens in two years or it happens next week. We know that at the end of that 10 year period, everything’s going to be done in the village and with the lifts. That’s the way we look at it.
Other investors
“I think, automatically, when you tell somebody that all you’re doing is plumbing the money back in the mountain for a decade. You get everybody all on the same page,” said Gross. “That’s as simple as you can put it. You’re not going to get somebody who’s trying to make a profit, right? At least, short term profit. It’s going to be somebody who lives here and wants it to be a better place, and if the investment happens to have some decent returns down the road, then so be it. Automatically, you get people that are culturally and strategically aligned.”
Ferri said that the plans for future infrastructure improvements “shouldn’t diminish at all what POWDR has done” over the past 17 years of ownership, which included building the Peak Lodge and the K-1 Base Lodge as well as large investments in grooming and snowmaking and tunnels to make trail intersections safer.
“The K-1 base Lodge, literally, is probably one of the best base lodges in the country right now,” said Ferri. “POWDR staying in as a minority owner, means they believe in the mountain, and the vision of the community, long term,” Ferri said.
Governance
“From governance perspective, it’s really going to be a very, very narrow group that will formulate decisions with the leadership team at the resort,” said Gross. “Operationally, we’re just going to let them run the resort. Most of the board level decisions are going to be around capital spending, moving those projects forward. We expect to have at least three independent board members [non-investors], and then there’ll be four or five other members, depending on who else comes into the deal,” he said.
“Solimano and his team know how to operate the resort day to day,” Gross added. “We’ll leave that to them and try to support them the best we can. While accelerating capital improvement plans to pave way for a better future.”
Editor’s note: Click links for Q&As with Phill Gross and Michael Ferrri.
