That’s right, this fancy pants club which counts Bill Gates, Dan Quayle (he’s a millionaire??), Jack Kemp, Peter Chernin, and Barry Sternlicht, among others can not afford to buy food. This whole Yellowstone Club meltdown involving all sorts of drama—divorce, fighting, lawyers, etc.—certainly is juicy.
WSJ: But a bankruptcy hearing in Missoula, Mont., on Wednesday shows just how bad the club’s cash crunch has become. According to an article in New West by Robert Struckman, only $40,000 remained in the Yellowstone Club’s bank account last week.
The article states:
“The club doesn’t have enough cash to make its $600,000 monthly payroll for its 521 employees or to buy food for its restaurants, or for the electricity needed to operate the chairlifts at its storied private ski area.”
In other words, the private golf and ski club with more than 350 of America’s richest members couldn’t afford to buy burgers for the restaurant.
The history of how the club got into this mess is complicated, and involves a messy divorce, lawsuit, and – most importantly – the real-estate bust and credit crunch.
We can’t wait for the inevitable CNBC documentary, or if some violence goes down, the Lifetime movie
The question now is who will end up as the owner?
Credit Suisse, which lent the club $375 million, is in the driver’s seat, according to the article. But the creditor battle is complicated by CrossHarbor, a Boston private-equity firm that has been working with owner Edra Blixseth on its own funding plan. As it stands, it looks like the club will be able to keep going with another $4.4 million from Credit Suisse.
The writer offers two excellent solutions.
There are, of course, two other alternatives. Gates can just buy it and save the hassle of worrying about where to ski this winter. Or, Blixseth can declare the club a bank holding company and ask for TARP funding. I’m sure Congress would understand.
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