Portland, Maine March 28, 2001 (AP by Jerry Harkavy)--Leslie B. Otten has resigned as chairman and chief executive of American Skiing Co., one of North America's biggest ski resort companies which only last week called off a planned merger with a hotel company.
The company said Wednesday that William ``B.J.'' Fair, a former Universal Studios executive who joined American Skiing last year and currently serves as its chief operating officer, would replace Otten as chief executive.
Otten, who founded the Newry-based company more than two decades ago, said in a statement that he has been investigating options outside American Skiing since merger discussions with MeriStar Hotels & Resorts began last summer.
On Dec. 11, American Skiing said it planned to acquire MeriStar for stock valued at $185 million. It said the deal would help it reduce the seasonal fluctuations of the ski business by combining it with a hotel operator whose business isn't weather dependent.
But the deal was called off last week just as American Skiiing shareholders were to vote on it.
Otten was in Florida and could not be reached for comment, a company spokesman said.
In his statement, Otten said he was proud of what he and his management team had accomplished at American Skiing, which owns nine ski resorts from Maine to California including Sugarloaf in Maine, Killington in Vermont and Steamboat in Colorado.
``We have built a remarkable company, and I am confident that the company's future under B.J.'s leadership will continue to improve as it moves into its next phase of development,'' he said.
The highly leveraged company has had a tough time since it went public in November 1997 and investors have shown little faith that it will soon recover. Its stock has fallen sharply from an initial price of $18 a share to under $2 recently.
American Skiing shares were down 6 cents at $1.63 a share as of midday Wednesday on the New York Stock Exchange.
Fair acknowledged that American Skiing faces near-term challenges but expressed confidence that management can create value for shareholders in the next few years.
Fair said his immediate priorities include improvements in cost management, organizational structure, sales and marketing efforts and in the company's capital structure to enhance financial flexibility.
American Skiing finished its last fiscal year with a loss of $32.3 million. It posted a loss in its most recent quarter, despite plentiful snow.
Otten got his start in the industry as a management trainee at the Killington resort and went on to become general manager at Sunday River, a Maine resort he later bought with $840,000 that he borrowed from its owner.
Over the next 20 years, Sunday River's attendance shot up from 40,000 to half a million as he expanded the resort and installed snowmaking equipment that would enable it to operate despite a scarcity of natural snow.
Otten was paid more than $400,000 last year, plus a bonus of more than $23,000, the Maine Sunday Telegram reported this week. His base salary grew by 16 percent since 1997, a period in which his company lost more than $130 million, the newspaper said.
American Skiing's other holdings include Attitash Bear Peak in New Hampshire; Mount Snow and Sugarbush in Vermont; The Canyons in Utah and Heavenly in California and Nevada.
On the Net:
American Skiiing site: http://www.peaks.com.
Copyright © 2000 The Associated Press