Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.
In addition to the two Texas properties, Cedar Fair has the right to acquire a third site, located on approximately 40 acres in Kansas City, Kansas, which previously operated as a Schlitterbahn water park, for a cash purchase price of $6 million.
Glitch99 wrote:Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.
If that were the case, there'd be little reason to delay transfering the third park - when the whole deal closes, the $261M being paid would simply be disbursed to settle the debt attached to each of the 3 parks at closing.
My guess is that CF wants to digest these new acquisitions before deciding if they want to swallow yet another $100M debt that would come with this third park.
Glitch99 wrote:Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.
The article makes it sound like they're only buying the land that formerly hosted a third park? Is that third location a currently operating park?In addition to the two Texas properties, Cedar Fair has the right to acquire a third site, located on approximately 40 acres in Kansas City, Kansas, which previously operated as a Schlitterbahn water park, for a cash purchase price of $6 million.
Edwardo wrote:Glitch99 wrote:Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.
The article makes it sound like they're only buying the land that formerly hosted a third park? Is that third location a currently operating park?In addition to the two Texas properties, Cedar Fair has the right to acquire a third site, located on approximately 40 acres in Kansas City, Kansas, which previously operated as a Schlitterbahn water park, for a cash purchase price of $6 million.
Nice job editing your post to delete the entire thing. No, the article says “Additionally, Cedar Fair has the right to acquire A property located in Kansas City, Kansas, for a cash purchase price of $6 million.”
Not the property the park is on, the park as a property.
Edwardo wrote:Glitch99 wrote:Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.
If that were the case, there'd be little reason to delay transfering the third park - when the whole deal closes, the $261M being paid would simply be disbursed to settle the debt attached to each of the 3 parks at closing.
My guess is that CF wants to digest these new acquisitions before deciding if they want to swallow yet another $100M debt that would come with this third park.
There’s every reason to delay. I’m assuming you’re not familiar with what’s going on with the Kansas park and how this works.
The Kansas park has $180 mill. In loans. CF obviously had valued the Kansas park at only $6m. If they purchase all three parks in one transaction, then not only are they purchasing assets, but also liability (the $180mill). Which means they’ve just inherited that debt for a park they don’t think is worth that much. CF is not looking to take on that liability. Obviously.
This is standard practice in corporate acquisitions, and there’s actually chatter in several places on line that this is the case.
So CF pays cash for the two parks that aren’t riddled with debt. Then the current owners pay off said debt. You know, the current owners that built a water slide at that park that decapitated a politician’s son and took on a lot of liability. The same current owners where one recently got caught with meth and hookers during the whole Verruckt investigation. Yeah. They sound like the type of people I’d trust up front to pay off those debts.
Which is why CF optioned it. Once the liability of loans are paid off, then CF has the right of first refusal to purchase the park.
Then Schlitterbahn will still have a few million dollars from the sell after they pay off the loans, and they’ll still have the third and fourth Texas parks to continue making money or shop around.
Cedar Fair isn’t going to pay that much for the parks AND ALSO take on the debt. Which is why they optioned the third park instead of purchasing it out right.
The option to buy Kansas City gives the company a chance to see whether the park is the right fit: “It’s something that we need to dig into more, and this gives us time to take a look,” he said.
Edwardo wrote:Cedar Fair is interested in the KC park, which is currently not operating. That park not only has $180 million in loans against it, and likely liens from the financiers, but purchasing the park and the liabilities would also put CF in a position to owe the money to the financiers that could and should be paid for with the money from the sell of the other two properties that the actual company that owes the money would make to cover their debts. Any lawyer worth their weight in salt would tell CF not to purchase the KC park with that amount of debt. Are you trying to tell me that Cedar Fair is interested in paying $6 Million for the park AND THEN still paying an additional $180 million for the park? A park that isn't valued at that amount? Riiiiiiight. CF isn't going to take on that much of someone else's debt when THEY'RE PAYING FOR THE ACQUISITIONS with CASH. There'd be a revolt.
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