Soon the ski season will start in Crans-Montana. Preparations on the Haute Plateau are in full swing. Craftsmen are installing signposts, restaurant owners are working on new menu cards, and the ski lift workers are running the gondolas up the mountain in trial operations.

Otherwise the place is still quiet. Just in time for the start of the season at the beginning of December, the spectacular views of the region’s four-thousand-meter peaks and its long slopes will once again attract many tourists to the resort above Sierre.

From luxury destination to general store

But the idyllic atmosphere is deceptive. The once luxury holiday destination has seen better days. Crans-Montana used to be considered a premium ski resort. One of the last highlights of that time was the hosting of the World Ski Championships in 1987. The event went down in sports history because Swiss athletes won 14 out of 30 medals.

Today, the slopes are blighted with 12,000 second homes. In the off-season, the apartment blocks in the center of Crans-Montana make a rather dreary impression. The aging infrastructure is in urgent need of renovations.

In addition, the ski resort is struggling to position itself in the market. As a result, Crans-Montana more closely resembles a general store than a luxury destination these days: There are electronic music festivals and snow parks for the younger crowds, golf tournaments for the rich and a climbing hall and ice field for families.

In light of all these challenges, the extremely wealthy Czech investor Radovan Vitek came along at just the right time in 2013. He is the main shareholder of the real estate group CPIPG, which owns properties worth 20.9 billion euros in Central and Eastern Europe. First, he bought the Crans-Montana Aminona Mountain Railways (CMA) and then other service providers such as restaurants, parking lots and stores. This gave rise to the CMA Group.

He himself is neither a member of the management nor the board of directors of his real estate companies. In his private life, too, he is considered reserved and media-shy. It is known, however, that their residence in Crans-Montana was the hub of the Vitek family for a long time. Perhaps it was this emotional connection that led him to invest in the ski resort. Because ski lifts are rarely attractive capital investments.

For Crans-Montana, the Czech billionaire was a beacon of hope. The place wanted to use his money to develop tourism.

But things turned out differently. Vitek may have underestimated Switzerland’s direct-democratic system. In any case, his «those who pay are in charge» mentality did not go down well on the Haute Plateau. The years-long disputes between Vitek and the municipality have now reached a new climax.

In spring, the CMA Group announced that Vitek was withdrawing as an investor and that the sale would be completed before the start of the winter season. Now, shortly before the start of the season, the municipal government is wondering what will happen to the ski lifts. Vitek himself declines to publicly comment on his possible retreat.

The power play has begun

To understand how this situation came about, the communal president, Nicolas Féraud, and the director of tourism, Bruno Huggler, tell us what has happened since last spring’s announcement. Because shortly afterwards, a strange list made the rounds in the village.

It not only listed the key figures of CMA operations, but also the sales prices for all of the company’s assets. In addition to the ski lifts, this includes parking lots, restaurants on the slopes, a clinic, a real estate agency, a ski school and a sports store. Cost of the portfolio: 225 million francs.

Féraud is certain that this list was deliberately disseminated, even if it seems more like a PowerPoint presentation with photos than professional sales documentation. The municipalities of Crans-Montana, Lens and Icogne, on whose territory the ski resort is located, already signaled their interest in buying back the ski lifts, the parking garages and possibly also the mountain restaurants last year.

So the goal is to return to the old model, when the municipal governments ran the ski lifts themselves but failed to develop them further? «Not at all,» Féraud counters. «We would set up an operating company with a new investor. The municipalities should not be the main owners of the ski lifts.» Because, in his view, ski lifts must be run as a business and not by the public sector.

So Vitek wants to sell, and the municipalities are interested—if it were not for the price of 80 million francs for the ski lifts alone. In order to check whether this price is realistic, the municipality had the ski lifts’ worth estimated by an external, independent company. The price they determined is well below 80 million francs. «The CMA would have to accommodate us. The citizens of our communities would not accept such a high price,» says Féraud.

In the 2020 annual report of Vitek’s company CPIPG, the CMA Group was valued at 67 million euros. The following year, this number fell to only 50 million euros. The company seems to be living off its substance. Philippe Magistretti, chairman of the board of directors of the CMA Group and Vitek’s proconsul, explains the large difference between the reported value and the targeted sales price with CPIPG’s conservative valuation methods.

«We’ve had a lot of investors come to us who are willing to pay 80 million francs for the ski lifts,» Magistretti says. «We are confident that we will be able to complete the sale before the winter season begins.» The power play has apparently begun.

The municipality’s president Féraud, however, is not impressed by this. Although he emphasizes that it is in the interest of the municipality to have more say regarding the ski lifts again—because of the many jobs involved and in order to develop the region holistically—but not at any price. It is questionable whether investors are really lining up in the face of rising interest rates and a looming recession. Tourism director Huggler says: «Buying the ski lifts is not enough. Every ski resort needs continuous renewal of transport facilities. In addition, the 2027 World Ski Championships are coming up.» According to him, additional investments are therefore unavoidable.

Turbulence on the Haute Plateau

It is not the first time that tensions arose between the investor Vitek and the municipalities on the Haute Plateau. This even went so far that the CMA stopped the operation of the ski lifts in 2018, despite ideal snow conditions, because the municipality did not comply with an allegedly agreed payment to Vitek.

The next scandal was not long in coming. In 2021, the CMA withdrew from the Crans-Montana Tourism Association. The reason was long-standing disagreements between Magistretti and Jean-Daniel Clivaz, the president of the tourism association. «The CMA’s strategic plans don’t align with the vision of the tourism association and the community,» Magistretti says. «I don’t share the opinion that large-scale investments in the existing transportation facilities are needed. But I’m certainly in favor of expanding the ski resort.»Since then, the situation has only worsened. At the beginning of 2022, for instance, the CMA proposed that the municipalities should lease the ski lifts from Vitek in order to have more of a say. At the same time, the CMA parted ways with general manager Maxime Fournier because of differing views on the direction of the ski lifts.

His successor, Maxime Cottet, was also suspended for three weeks at the beginning of November – shortly before the start of the season. «To prepare CMA for the challenges, I asked the general manager to isolate himself from the company for three weeks to come up with an action plan,» Magistretti says. «This also gives him an opportunity to rethink his position in the company.»

In a holiday destination, such turbulence can have devastating consequences. An important factor in the success of a ski resort is the smooth cooperation between the owners of ski lifts, the municipalities, the tourist associations, hoteliers and other service providers

. This requires a common strategy. «For many years, we have repeatedly approached the cable car companies with strategic considerations for the entire region. But the CMA Group has tried to dictate its own vision to us from the beginning,» says Féraud.

Crafty businessman

It is possible that the people in Crans-Montana failed to realize that Vitek is a shrewd businessman who sometimes resorts unscrupulous methods. He proved this in his early days, when he founded a company in Slovakia after the collapse of the Soviet Union in the early 1990s. The company traded in coupons that the government had given to citizens free of charge for the purpose of privatizing state-owned enterprises.

Vitek then entered the real estate business, specializing in office and retail space. Last year, he bought the Viennese real estate groups Immofinanz and Immo S, increasing his real estate portfolio from 11 to 20.9 billion euros. His company CPIPG operates in the Czech Republic, Germany, Poland and other Central European countries.

The trial surrounding the Luxembourg real estate company Orco (now CPI FIM SA) also caused a stir. Vitek is accused of having secretly taken control of the company with the help of straw men. The lawsuit was dismissed in the USA for the time being. The Luxembourg regulator for market abuse, however, has already issued a fine of 1.5 million dollars to Vitek. For the billionaire, this is nothing – just like buying a ski resort. His engagement in Crans-Montana comprises only 0.5% of CPIPG’s assets.

Vitek is reported to have said that Crans-Montana accounted for less than 2% of his fortune, but caused 80% of all his headaches. Whether another investor will soon appear on the scene to relieve him of his pain remains an open question.

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