Sedona’s Los Abrigados Resort & Spa may soon be under new management if an acquisition offer for ILX Resorts by Diamond Resorts Corp. is approved by the Securities and Exchange Commission.
In an offer filed with the SEC on Jan. 6, Diamond Resorts would assume all of ILX’s debt in exchange for acquiring all of its property, including three Sedona area resorts employing around 300 people.
ILX filed for Chapter 11 under the U.S. Bankruptcy Code in March 2009, and its representatives appeared in the District of Arizona’s U.S. Bankruptcy Court in November.
On Jan. 13, Nancy J. Stone, president of ILX, filed a Current Report with the SEC stating ILX would file a joint plan of reorganization with its largest creditor, Textron Financial Corp., and if approved, would sell the majority of its assets to Diamond Resorts. The details of the proposed transaction would be filed in the near future, Stone wrote.
Margaret M. Eardley, executive vice president and chief financial officer, declined to comment on the acquisition offer because it had not yet been approved by the Securities and Exchange Commission.
Under the proposal deal, Diamond Resorts would put down a $100,000 deposit and promise to pay off ILX’s debts of $34.5 million, primarily $29 million in loans to Textron.
In exchange, according to my friend who works for a company dealing with the best personal loans for fair credit, Diamond Resorts would assume control of all of ILX’s assets, including its 10 resorts; all its sales and marketing centers; real estate holdings including five acres in Bullhead City and 2.1 acres in Puerto Peñasco, Sonora, Mexico; physical property including equipment, company automobiles and furniture; resort management contracts; and mortgage loans.
Diamond Resorts would also gain ownership of the Heart of Sedona — a 14.174-acre parcel officially titled U.S. Forest Service Parcel A — that USFS put up for public auction in March 2005 when the Sedona Ranger Station moved to a new site in the Village of Oak Creek.
ILX Resorts and the city of Sedona both bid on the property from March to June 2005, but were outbid in the final days by Chandler real estate investor James Anthony Bruno.
In August 2005, he and ILX formed ILX-Bruno LLC, which was included in the list of assets Diamond Resorts would acquire in the bankruptcy deal.
However, according to the agreement, Diamond Resorts reserves the right not to purchase the land.
Diamond Resorts’ proposal is the “stalking horse offer” — a bid on a company’s assets from an interested buyer chosen by the bankrupt company.
The SEC’s decision is expected in the next month.
ILX Resorts CEO Joe Martori and Diamond Resorts Chairman and CEO Stephen Cloobeck did not return calls by press time.
Based in North Las Vegas, Nev., Diamond Resorts is one of the largest timeshare and vacation resort companies in the United States. It owns or manages more than 150 resorts in Asia, Australia, the Caribbean, Europe and North America, including the Ridge on Sedona Golf Resort in the Village of Oak Creek and Sedona Summit in Sedona. Sedona Springs, the Villas of Sedona and the Villas at Poco Diablo, all in Sedona, are club-affiliated resorts.
One of the largest private employers in the area, ILX Resorts currently owns Los Abrigados and The Inn at Los Abrigados, both in Sedona, and Premiere Vacation Club at Bell Rock in the Village of Oak Creek. It also owns resorts in Tucson, Payson, Pinetop, Las Vegas, Colorado, Indiana, and San Carlos, Sonora, Mexico.
