[BrianH1970]

https://www.bizjournals.com/charlotte/news/2019/10/02/word-of-potential-buyout-offer-puts-stock-in.html

Could a new era be on the horizon for the Charlotte region's biggest tourist attraction? Word of a potential deal between Cedar Fair Entertainment Co., the owner of Carowinds, and rival Six Flags Entertainment Co. took stock prices for a ride on Wednesday.

Trading was halted briefly for shares of Cedar Fair (NYSE: FUN) due to volatility around midday, when Reuters reported that Six Flags (NYSE: SIX) had approached it with a cash-and-stock acquisition offer. Citing unnamed sources, the news service noted Cedar Fair is said to be considering the offer, the details of which "could not be learned."


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Amusement park operator Cedar Fair halted for volatility after surging 10% on a Reuters report that Six Flags is in a bid to acquire it. https://www.cnbc.com/quotes/?symbol=FUN …

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As of 2:30 p.m., Cedar Fair's stock was trading at $60.94, up 4.7% from Tuesday's close at $58.20.

Shares of Six Flags, meanwhile, were at $50.37 down 2.2% from closing at $51.51 the previous day.

However, according to investor website Seeking Alpha, some observers are not convinced such a tie-up makes sense.

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Cedar Fair has spent the past several years pouring millions of dollars into Carowinds, the Charlotte region's No. 1 tourist attraction by attendance with more than 2 million visitors annually, and its latest investments mark some of its largest to date. Those include the new Blue Ridge Junction themed area and Copperhead Strike roller coaster that opened within the park this spring, a 400-room dormitory for seasonal workers, many of whom are students, added over the summer; and a 130-room Springhill Suites by Marriott hotel that's expected to open soon.

I think that rumor's mostly been discounted now.

[aoriole19]

Assuming it is real and they did try to go through with it (big assumptions), do you think the FTC would block it?

[RollerBee]

Cedar Fair will very likely never get rid of Michigan’s Adventure or Dorney. They aren’t ‘neglecting’ those parks. MI especially, and Dorney are two of the most profitable parks in the chain.

They aren’t adding stuff often because the parks are making enough money and attendant is high enough that they don’t have to make as many investments to keep people coming.

What are your thoughts on Six Flags closing Parks with overlapping markets.

IE Dorney and SFGAd, CGA and SFDK. Would it be offbase to think that Dorney and CGA could be at risk IF Six Flags gets Cedar Fair.

[yawetag]

Assuming it is real and they did try to go through with it (big assumptions), do you think the FTC would block it?

Without divesting any of the assets? Definitely.

[Edwardo]

It wouldn’t really be a monopoly. Even IF this happened, regional parks are often a monopsony when there aren’t other options close, which already applies to many of the regional parks. Remember, these are regional, so just because one company owns more parks in separate regions, these regional parks already don’t really ‘compete’ (and they’ll often be the first to tell you). And in markets where both companies have overlap, there are still other players in those markets. SoCal has Disney and Seas. The north east has a ton of other parks other than Dorney and SFGadv.


So it’s unlikely the SEC is going to say monopoly as most parks are already a monopsony and the ones that aren’t would still have local competition in said markets.

[Edwardo]

What are your thoughts on Six Flags closing Parks with overlapping markets.

IE Dorney and SFGAd, CGA and SFDK. Would it be offbase to think that Dorney and CGA could be at risk IF Six Flags gets Cedar Fair.

Nah. Or at least highly unlikely. If Dorney AND SFGADv are both successful. Why close? If SFDK AND CGA (and Gilroy Gardens, which CF has the management contract for) then why close one down?

Don’t look at GL. Had SF not ruined the park by over expanding, they smaller family park would have been perfect for the CF portfolio, just like Kennywood would have been had Kinsel been able to buy it when he wanted to.

The Frisco, SoCal, and over all NY, NJ, Philly metro areas ALL have the population centers to support these parks.

[LocoDriver]

https://www.bizjournals.com/charlotte/news/2019/10/02/word-of-potential-buyout-offer-puts-stock-in.html

Could a new era be on the horizon for the Charlotte region's biggest tourist attraction? Word of a potential deal between Cedar Fair Entertainment Co., the owner of Carowinds, and rival Six Flags Entertainment Co. took stock prices for a ride on Wednesday.

Trading was halted briefly for shares of Cedar Fair (NYSE: FUN) due to volatility around midday, when Reuters reported that Six Flags (NYSE: SIX) had approached it with a cash-and-stock acquisition offer. Citing unnamed sources, the news service noted Cedar Fair is said to be considering the offer, the details of which "could not be learned."


CNBC Now
✔
@CNBCnow
Amusement park operator Cedar Fair halted for volatility after surging 10% on a Reuters report that Six Flags is in a bid to acquire it. https://www.cnbc.com/quotes/?symbol=FUN …

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76
11:59 AM - Oct 2, 2019
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62 people are talking about this
As of 2:30 p.m., Cedar Fair's stock was trading at $60.94, up 4.7% from Tuesday's close at $58.20.

Shares of Six Flags, meanwhile, were at $50.37 down 2.2% from closing at $51.51 the previous day.

However, according to investor website Seeking Alpha, some observers are not convinced such a tie-up makes sense.

TRENDING
EDUCATION
Ranking N.C. private universities by total cost of attendance

RETAILING
PHOTOS: Inside Charlotte’s new action bar, virtual reality hub
Coliseum V dials in on interactive experiences with action-packed games, virtual reality units and a self-pour bar.
COMING EVENT
2019 Best Places to Work Awards
Nov. 8


Cedar Fair has spent the past several years pouring millions of dollars into Carowinds, the Charlotte region's No. 1 tourist attraction by attendance with more than 2 million visitors annually, and its latest investments mark some of its largest to date. Those include the new Blue Ridge Junction themed area and Copperhead Strike roller coaster that opened within the park this spring, a 400-room dormitory for seasonal workers, many of whom are students, added over the summer; and a 130-room Springhill Suites by Marriott hotel that's expected to open soon.

I think that rumor's mostly been discounted now.

Where has this been discounted?

[Cameron]

I think it's gonna happen but I think some parks are going to be sold. Probably the lowest performing ones

[Distopia]

https://www.google.com/amp/s/seekingalp ... discounted

[BrianH1970]

https://www.google.com/amp/s/seekingalpha.com/amp/news/3503468-cedar-fair-six-flags-merger-report-discounted

That, and then this...

https://www.themeparkinsider.com/flume/201910/7040/


In a two day span that saw the stock market plummet, a few shareholders still managed to make a few dollars out of that story.

[Edwardo]

I think it's gonna happen but I think some parks are going to be sold. Probably the lowest performing ones

Based on what? The Reuter’s report gave no specifics, Six Flags doesn’t really have a CEO as they’ve been searching for a replacement for a while for Jim Anderson, and with what money?

In 2006 CF bought Paramount Parks for $1.24 billion (that’s over $1.5 billion in 2019 dollars)c and that was only 5 parks and 2 management contracts.

Those 5 parks are worth way more now and then add in 11 additional parks/water parks, and 13 hotel/camp grounds, with those parks having had MILLIONS invested in them over the last several years, the company would be worth several billion dollars. How many billions are those 15 parks, a management contract, sports force, and hotels worth? I’d say way more than SFI has to pay.

CF doesn’t have any ‘low performing’ parks. And they just purchased a small water park resort chain with an option to buy a third park.

[Glitch99]

In 2006 CF bought Paramount Parks for $1.24 billion (that’s over $1.5 billion in 2019 dollars)c and that was only 5 parks and 2 management contracts.

Those 5 parks are worth way more now and then add in 11 additional parks/water parks, and 13 hotel/camp grounds, with those parks having had MILLIONS invested in them over the last several years, the company would be worth several billion dollars. How many billions are those 15 parks, a management contract, sports force, and hotels worth? I’d say way more than SFI has to pay.

CF has a market cap of just under $3.5 billion. That's what CF is worth, and is the basis for what Six Flags would be paying; what CF has spent over the past years is irrelevant. And not cash, they can make the payment by issuing new SIX stock (the first reports indicated a cash + stock offer).

The only question is if CF board of directors accepts an offer or not, and how much more SIX may need to offer to get them to bite (some speculation puts a "fair" takeover value at $90/share) - at which point it may no longer be an attractive acquisition for them.

[yawetag]

some speculation puts a "fair" takeover value at $90/share

If that's the case, it's hugely undervalued at $61/share right now. I don't trust that speculation, or you'd see the stock start to climb a lot closer to $90 than it is right now (as a reference, it's lowest point the last 3 days was $57.40/share, so only up $3.50 or so).

[Glitch99]

some speculation puts a "fair" takeover value at $90/share

If that's the case, it's hugely undervalued at $61/share right now. I don't trust that speculation, or you'd see the stock start to climb a lot closer to $90 than it is right now (as a reference, it's lowest point the last 3 days was $57.40/share, so only up $3.50 or so).

For sure, that's a huge difference and I dont give it much weight either. But, it also implies there is a lot of future potential in CF parks, that CF isnt going to just hand over to SF either.

[sorashaun]

I can’t believe some of you are entertaining this obvious clickbait.