Feds Step In: DOJ Investigates Antitrust Concerns Over Alterra's Arapahoe Basin Acquisition
The U.S. Department of Justice (DOJ) is throwing a wrench into Alterra Mountain Company's plans to acquire Arapahoe Basin Ski Area. Citing potential antitrust concerns, the DOJ has launched an investigation into the proposed deal.
This isn't the first time Arapahoe Basin has found itself at the center of an antitrust battle. In 1996, the DOJ successfully blocked Vail Resorts' attempt to acquire the ski area, arguing it would "lessen competition substantially in the Front Range skier market." The precedent set back then raises questions about the future of Alterra's ambitions.
The investigation hinges on the potential impact on competition within the Colorado ski industry. Alterra already owns and operates several popular resorts in the state, including Steamboat Springs and Vail. Adding Arapahoe Basin to their portfolio would create a skiing giant, potentially limiting consumer choice and driving up prices.
"The DOJ is committed to ensuring a fair and competitive marketplace," a department spokesperson stated. "We will thoroughly investigate this proposed acquisition to determine its potential impact on skiers and snowboarders in Colorado."
While the DOJ review is ongoing, the Forest Service, which oversees the special use permit for Arapahoe Basin, has placed its own review on hold. This effectively pauses the entire acquisition process until the DOJ reaches a decision.
Alterra Mountain Company remains confident in the deal's approval. "We believe this acquisition will benefit skiers and snowboarders by providing them with more access and greater value," said an Alterra spokesperson.
However, local skiers and snowboarders are expressing concerns. Some fear a potential reduction in choice and an increase in lift ticket prices. The Colorado Ski Country USA association, which represents many of the state's independent resorts, is also closely monitoring the situation.
The DOJ has also contacted the NSAA requesting information to assist their investigation. In a letter to members the NSAA says:
"As part of the Federal Government’s inquiry relating to the acquisition of Arapahoe Basin by Alterra Mountain Company, the Department of Justice has served NSAA and RRC Associates with a Civil Investigative Demand, which is akin to a civil subpoena. This is a routine investigative tool used by the DOJ to collect information from various sources in order to study the proposed acquisition and to assess prospective impacts to competition in the region that may result.
"The data that the DOJ has commanded from NSAA and RRC consists of content from each of the three annual surveys (Kottke, Demographic, and Economic Analysis) for the 2018/2019 to 2023/2024 seasons. We have been successful in working with the DOJ to narrow their request to a scope that meets their needs but does not overreach. The DOJ has agreed to reduce the scope of NSAA and RRC’s combined productions to about half of the content from each of the three surveys, and to reduce the geographic scope to just the Rocky Mountain Region.
"We are writing to let you know that the data you supplied to NSAA and RRC in one or more of these studies will be included in our production submittal to the DOJ. The data will not be presented in aggregate. The raw data files have been requested. At present, the production due date is June 26, 2024.
"NSAA is determined to maintain the strictest confidentiality in assembling all of the data for these studies and to ensure that the information is used for the good of all the membership. 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."
The DOJ's investigation throws the future of the Arapahoe Basin acquisition into uncertainty. With echoes of the past lawsuit, the outcome could have significant implications for competition within the Colorado ski industry.
