Six Flags makes Aquisition Bid on Cedar Fair

[Magic-Man]

Cedar Fair turns away Six Flags - Cedar Fair, L.P. (NYSE:FUN) | Seeking Alpha

The entire roller coaster community sighs in relief.

 

[Andysol]

I understand why Six flags wanted to make this deal and why cedar fair didn’t. But honestly, neither are in a good position.

Both of them have basically no cash. Six is $100m and cedar is a bit less than that. Six has 2.5b in debt and is a 4b market cap. Cedar is 2b in debt and about a 3.4b market cap (but would have sold at 4b @ $70/share). Although that $70 wouldn’t hold as it’s an almost all stock deal, so they’d ultimately sell for significantly less.

If cedar sold, then Six flags is sitting on about a 7b market cap and 6b in debt with no cash. Talk about a house of cards.

But as I started with, they’re both houses of cards as it is. So at least a merger/acquisition they could have streamlined more and done redundancy layoffs and hoped for the best.

Cedar fair won’t ever get offered $70/share again and it was way overvalued. Then again, it was still a bad deal.

 

[GadgetGuru]

I understand why Six flags wanted to make this deal and why cedar fair didn’t. But honestly, neither are in a good position.

Both of them have basically no cash. Six is $100m and cedar is a bit less than that. Six has 2.5b in debt and is a 4b market cap. Cedar is 2b in debt and about a 3.4b market cap (but would have sold at 4b @ $70/share). Although that $70 wouldn’t hold as it’s an almost all stock deal, so they’d ultimately sell for significantly less.

If cedar sold, then Six flags is sitting on about a 7b market cap and 6b in debt with no cash. Talk about a house of cards.

But as I started with, they’re both houses of cards as it is. So at least a merger/acquisition they could have streamlined more and done redundancy layoffs and hoped for the best.

Cedar fair won’t ever get offered $70/share again and it was way overvalued. Then again, it was still a bad deal.

I don't see any way of getting out of it unless they sell some parks.

There's a number of parks in both chains that I just can't see ever making money. I don't want to see any regional parks shut down, but there's no way some of the smaller parks are profitable. No amount of corporate mergers or consolidation is going to solve that.

A better run Cedar Point just means there's more cash-flow to cover up the losses at Michigan's Adventure

 

[bob albert]

I just think either park chain buying the other would just add debt that would not be recovered by streamlined operations. Quite frankly if some of the regional parks are not performing well enough it is time to think about selling for peanuts closing, or splitting up the rides among the more successful parks. The top cedar fair parks are becoming destinations despite the chains problems. They need to keep investing in these accordingly without dead weight in today's park landscape.

 

[GAcoaster]

Interesting article in Orlando Weekly talking about the current flux that seems to be taking place behind the scenes in the theme park industry. Some speculation about potential buyouts and mergers among many of the chains: The future of Florida's amusement parks is about to get really complicated, thanks to a bunch of investment firms | Blogs