HELENA – The bankruptcy judge for the exclusive Yellowstone Club has said he may decide who has offered the winning bid for the resort, The Billings Gazette reported on its Web site.
The auction for the club, which has more than $400 million in debt, was set to start Wednesday, but has repeatedly stalled over disagreements between the bidders.
“The hangup has been the inability of all of the parties involved to agree to get this thing to move forward,” said U.S. Bankruptcy Court Clerk Bernard McCarthy.
The international firm Credit Suisse, which loaned the club $375 million three years prior to its fall, has offered a “credit” bid of $110 million, including nearly $44 million in cash.
The other bidder, CrossHarbor Capital Partners, has bid $100 million, with a $30 million cash component. Its bid also includes a promise to invest $75 million in the posh resort over the next few years.
Located in southwestern Montana, the Yellowstone Club is a private resort for the ultra-rich that boasts its own ski hill, golf course and more than 300 members. After building a reputation as one of the world’s most exclusive havens for the wealthy, the club declared bankruptcy in the fall.
Since Wednesday, Judge Ralph Kirscher has had to intervene a number of times to settle disputes between the bidders.
According to the club’s chief restructuring officer, Ron Greenspan, Boston-based CrossHarbor has brought forward a superior bid, because it ultimately would pump more cash into the club. The Credit Suisse bid, on the other hand, would leave the club with another $80 million to $90 million in debts, he said.
A lawyer for Credit Suisse, Mark Chehi, rejected Greenspan’s analysis and said the bidding process was unfair to his client.
The winning offer for the club must be evaluated on the basis of both structure and size. Until the resort’s new ownership is settled, a bankruptcy restructuring plan cannot be finalized to lift the club out of its debt-mired position.
“I’ve given you every opportunity to work this out. There’s too much on the line here to let this go nowhere,” Kirscher said in court Friday. “Are we going to have Yellowstone Club become a ghost town?”
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