W.Va. man lays claim to Greenbrier
Monday, May 11, 2009
A showdown could be looming over control of The Greenbrier.
Jim Justice, a West Virginia coal and agriculture tycoon, said May 7 that he had purchased the historic resort. That came as news to many parties, including Marriott International Inc., which thought it had a deal in place to acquire The Greenbrier from CSX Corp.
Justice told the Charleston Daily Mail that he paid CSX $20.1 million to buy the resort, and another $2.6 million to cover the break-up fee in the Marriott-CSX deal, which had been in place since The Greenbrier went into bankruptcy in March. Justice also bought 80 percent of The Greenbrier Sporting Club, a high-end residential development on the resort’s property.
Marriott indicated that it expects CSX to honor their agreement, which called for CSX to lend Marriott $50 million to operate the hotel for two years. After that, the hotel company would pay CSX between $60 million and $130 million, depending on the hotel’s performance.
The Greenbrier has lost $90 million over the past five years, including $35 million in 2008, according to its bankruptcy filing.
Though not well known outside of West Virginia, Justice is a Greenbrier County resident with deep roots in the community and state.
Justice, 58, is chairman and CEO of Bluestone Coal Group, which he has run since his father died in 1993. On April 22, he sold Bluestone to Mechel OAO, a Russian mining firm, for $436 million in cash. He also has large agricultural holdings in several eastern states.
Though he is new to the hospitality industry, Justice told the Daily Mail that he intends to run The Greenbrier and has no plans to bring in Marriott to manage the resort.