'Looking at hard times'- ski season uncertain as liquidation beckons for RAL

Tuesday, 20 June 2023

A watershed meeting for the fate of the Ruapheu skifields was held in Ohakune, Wellington and Auckland.

The Mount Ruapehu ski season might not go ahead, with local leaders and businesses fearing a big economic hit after a key meeting to decide the fate of two ski fields.

Ruapehu Alpine Lifts (RAL) has been given back to its directors and is to be liquidated after creditors voted down a proposal to save the business operations of the North Island’s two main skifields, Whakapapa and Tūroa.

Ruapehu District’s mayor says the move leaves only a 50/50 chance there’ll be skiiing on mountain this winter.

RAL’s creditors met for more than four hours on Tuesday in Ohakune, Auckland and Wellington to determine the fate of the company, which went into voluntary liquidation in October after a lack of snow and visitors over three years.

Creditors, which include the government, ANZ Bank, and skifield life pass holders, had to choose between three options for the future of the skifield.

For a resolution to pass it needed 50% of votes by number and 75% by value of creditors, a source at the Auckland meeting said. This meant overcoming the split between the large number of small-value creditors, versus the handful who own most of the beleaguered company’s debt.

Resolution A, which was executing a a deed of company arrangement proposedby the Ruapehu Skifield Stakeholders Association to retain the RAL company structure and renegotiate the company’s debts, had 71% in favour in numbers but only had 8.6% in value. It would have relied on life-pass holders purchasing new life passes to retain their right to ski, and crowdfunding to generate new capital.

The voting forms that were provided to creditors.

Resolution B, which was the recommended option by administrators John Fisk and Richard Nacey of PWC, also failed after achieving 93% in value but only 44% in numbers.

The terms of this option were developed by the Crown and involved executing a “pre-packaged liquidation” of RAL.That would be immediately followed by the sale of the Whakapapa and Tūroa skifields to two new entities, Whakapapa Holdings and Pure Tūroa (PTL), for $1 each.

The Government would take a 25% share in each company, and provide each with a loan, amount unknown.

The third option, which was to end the administration and return control of the company to the directors, was automatically adopted following the failure of the other two options.

It’s worrying local communities whose businesses are largely dependent on winter tourists. Video first published October 13 2022.

The meeting was told directors had already applied to wind up RAL and a court hearing was scheduled for Wednesday.

Sam Clarkson, who owns Skotel Alpine Resort in Whakapapa Village and a shareholder in the lift company, said the Prime Minister could still intervene and stop the liquidation from happening.

He proposed MBIE and Department of Conservation – which are significant creditors of the company – forgive the debt RAL owed.

A life-pass holder at the meeting said no one from MBIE was present. A lawyer advising MBIE delivered a prepared speech but didn’t answer questions. No one from DOC was prepared to speak.

Ruapehu district mayor Weston Kirton said there was a 50/50 chance the skifields would reopen this season.

Jason Platt, the chairman of the Ruapehu Skifields Stakeholders Association, told the meeting that community ownership via option A was its objective; but a “privatisation” option had been predetermined and was what the RAL board wanted three years ago.

‘Uncertainly is causing alarm bells’

Ruapehu mayor Weston Kirton, who said his council recently voted to support MBIE’s two skifields proposal, told Stuff he was disappointed there was no decision made and felt there was a 50/50 chance skiing would not go ahead on the mountain this season.

“We are down, but not out,” he said.

“Will there be skiing? We were anticipating they would start up this week, but that probably won’t be happening.”

Kirton said he felt for everyone involved with the mountain – families and workers, and local businesses – who would all suffer from a lack of certainty around the decision.

“This uncertainly is causing alarm bells all round.”

John Chapman, who lives in Raetihi on the Tūroa side of the mountain and is a former Ruapehu District Council Waimarino/Waiouru Community Board member, said the decision was “a cluster f**k quite frankly”.

“If there is no skiing this season, it’s something that will affect the whole community, and in Ohakune businesses will close, people will lose jobs.

“There is so much speculation and everyone has got an opinion, so it’s hard to figure out what the facts actually are.

“So much depends on the skifields and this will have a ripple effect to neighbouring towns and people who work on the mountain itself, and of course Taupō.

“We are looking at hard times if it doesn't happen.”

Chapman said he did not think people had digested the detail behind the decision and the fact “there may not be a ski season this year”.

Regional Development Minister Kiri Allan said the Government's position has always been to try to keep the ski fields open, save jobs and support the local and regional economy.

“Given that neither the resolution to execute a deed of company arrangement, or the resolution to appoint liquidators was passed, the control of RAL has been returned to the directors.”

Any questions on their next steps should be directed to them, she said.

“This is now a legal matter which is not controlled by the Crown.”