Amusement park operators Six Flags and Cedar Fair have reached a deal to merge amid a drop in consumer spending. The move will unite two of the largest US theme park operators.
Via press releases from both Six Flags and Cedar Fair, the combined company will look after 42 amusement parks and 9 resort properties across 17 US states, Canada and Mexico. This includes 27 amusement parks and 15 water parks.
The deal had a pro-forma enterprise value of about $8 billion based on both companies’ debt and equity values as of 31 October.
The merger agreement has been unanimously approved by the boards of both companies. Under the terms, Cedar Fair unitholders will get one share in the combined company and Six Flags shareholders will get 0.5800 shares, for every share they hold.
Merger agreement unanimously approved
The Wall Street Journal reported on Thursday that the merger could be a roughly $2 billion all-stock deal, citing company executives.
“Our merger with Six Flags will bring together two of North America’s iconic amusement park companies to establish a highly diversified footprint and a more robust operating model to enhance park offerings and performance,” said Richard Zimmerman, Cedar Fair’s president and CEO.
“Together, we will have an expanded and complementary portfolio of attractive assets and intellectual property to deliver engaging entertainment experiences for guests. The combination also creates an enhanced financial profile with strong cash flow generation to accelerate investments in our parks to delight our guests, driving increased levels of demand and in-park value and spending.
“I have great respect for the Six Flags team and look forward to joining forces as we embark on this next chapter together.”
Selim Bassoul, Six Flags’ president and CEO, said: “The combination of Six Flags and Cedar Fair will redefine our guests’ amusement park experience as we combine the best of both companies.
“Six Flags and Cedar Fair share a strong cultural alignment, operating philosophy, and steadfast commitment to providing consumers with thrilling experiences.
“By combining our operational models and technology platforms, we expect to accelerate our transformation activities and unlock new potential for our parks.
New company to oversee 42 parks
“We are excited to unite the Cedar Fair and Six Flags teams to capitalize on the tremendous growth opportunities and operational efficiencies of our combined platform for the benefit of our guests, shareholders, employees, and other stakeholders.”
The merger is expected to close in the first half of 2024, when the combined company will operate under the name Six Flags. It will be head headquartered in Charlotte, North Carolina, and will maintain significant finance and administrative operations in Sandusky, Ohio.
The companies have discussed a merger before. In 2019, Cedar Fair rejected Six Flags’ $4 billion cash-and-stock offer to combine.
Images courtesy of Six Flags and Cedar Fair
