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Six Flags / Cedar Fair Merger Announced

cookie said:
attractionsmagazine.com

Six Flags potentially selling some of its theme parks following Cedar Fair merger

Six Flags will conduct a "comprehensive review" of its 42 parks and may sell some of them, just months after merging with Cedar Fair.
attractionsmagazine.com attractionsmagazine.com

Guess it's time to start hedging bets...
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"potential divestiture of non-core assets" as it reads within the outline.

My immediate take would be consideration for water park and indoor water park resorts, which may have a wider market interest for potential buyers.

For actual amusement parks, this is the kicker - the Six Flags/Cedar Fair merger essentially killed regional market competition (which previous was the two firms competing). Unless there's interest from Herschend, Parques Reunidos, or evermore obscure operators, it's hard to really figure out who would be buying.
 
Maybe Merlin could buy some, if they wanted to increase their foothold in the US market? The company was said to have been interested in the Busch Gardens parks in the past, so it wouldn’t be wholly surprising to me if they did end up buying other US parks.

Although Resort Theme Parks admittedly aren’t their core growth area, with the size of this division having stayed exactly the same since the Tussauds merger in 2007, so perhaps that pours cold water on that idea…
 
Matt N said:
Maybe Merlin could buy some, if they wanted to increase their foothold in the US market? The company was said to have been interested in the Busch Gardens parks in the past, so it wouldn’t be wholly surprising to me if they did end up buying other US parks.

Although Resort Theme Parks admittedly aren’t their core growth area, with the size of this division having stayed exactly the same since the Tussauds merger in 2007, so perhaps that pours cold water on that idea…
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That would be an interesting possibility. I'd love to see a Nemesis or Oblivion in the US.

Although knowing Merlin as a Brit, it's a chain that focuses very much on overselling fast tracks, oversubscription of disability passes, constant downtime, reliability/maintenance issues, cheap IP based areas and a constant focus on removing water and flat rides.

I'm not sure there is a American park chain that Merlin can be compared to although I've heard Six Flags goes close apparently. I'm sure the American theme park fans can compare Merlin and the US chains better than I can.
 
owenstreet7 said:
I'm not sure there is a American park chain that Merlin can be compared to although I've heard Six Flags goes close apparently. I'm sure the American theme park fans can compare Merlin and the US chains better than I can.
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Six Flags and Merlin are only comparable in their lackluster operations but that's about it. I'd say Merlin is way worse than Six Flags all in all, so I don't even want Frontier City (which is the by far worst Six Flags Park in terms of the ride portfolio it offers) switching ownership to Merlin.
 
Hyde said:
For actual amusement parks, this is the kicker - the Six Flags/Cedar Fair merger essentially killed regional market competition (which previous was the two firms competing). Unless there's interest from Herschend, Parques Reunidos, or evermore obscure operators, it's hard to really figure out who would be buying.
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Hard to figure out why they are selling, as well. Now that they've more or less obtained a monopoly, would it really be a good idea to put some of their parks back on the market for a competitor to buy? Wouldn't it make more sense to just close the parks and enjoy full ownership of the market?
 
Pokemaniac said:
Hard to figure out why they are selling, as well. Now that they've more or less obtained a monopoly, would it really be a good idea to put some of their parks back on the market for a competitor to buy? Wouldn't it make more sense to just close the parks and enjoy full ownership of the market?
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In my personal opinion, a monopoly in theme parks isn't a good thing as from experience in the UK and Merlin, there's a lot of issues associated with a single theme park operator running the country's major theme parks with no major competitor on a similar scale.

I am baffled why Six Flags would want to sell the lower performing theme parks as I'd thought they'd keep those and invest minimally in the parks.

I hope buyers are found for those parks as competition is needed (even if it's from Merlin).
 
The company's earnings release mentions the term leverage 11 times and often it's in conjunction with reducing its leverage. Its goal is to get its leverage ratio to 3.5x by the end of 2027. I have not done a trailing 12-month analysis but annualizing its adjusted EBITDA from its Q3 YTD results leads to a leverage ratio of 5.3x.

There are two ways to adjust an operating leverage ratio, increase adjusted EBITDA (essentially normalized cash flow) or decrease debt. Increasing adjusted EBITDA is difficult and gains will often only be made by percentage points or even fractions of percentage points year over year. Selling less profitable properties and using those sales proceeds to reduce debt is one way to get to that 3.5x ratio sooner.
 
The new Six Flags is investing more than $1 billion in its parks over the next two years. The investments, which will total between $500 million and $525 million in both 2025 and 2026, will include new rides, attractions, themed areas, dining upgrades, and technology enhancements. More than $80 million of the overall two-year spend will go toward food and beverage upgrades, including new restaurant concepts and improved menu offerings.

Among the capital investments currently planned for the 2026 operating season:
  • Carowinds will introduce a record-breaking water ride
  • Canada’s Wonderland will add a new record-breaking water attraction
  • King's Island will introduce a new family thrill attraction
  • Knott’s Soak City will receive a water park refresh and aesthetic enhancements
  • Six Flags Magic Mountain will debut a first-of-its-kind coaster in North America
  • Six Flags Great America will celebrate its 50th anniversary, debuting a new kids’ area, commemorative events and park enhancements
  • Six Flags Great Adventure will unveil a record-breaking launch coaster
  • Six Flags Over Texas will unleash a record-breaking dive coaster
  • Six Flags Mexico will introduce a family thrill boomerang coaster
 
ECG said:
[*]Six Flags Great America will celebrate its 50th anniversary, debuting a new kids’ area, commemorative events and park enhancements
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What, no love for California's Great America and ValleyFair, both of which will also be celebrating 50 years along with SFGAm in 2026.
 
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Steely Dan said:
What, no love for California's Great America and ValleyFair, which also be celebrating 50 years along with SFGAm.
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California's Great America and ValleyFair were not mentioned in the press release, but that doesn't mean something won't be done for the anniversary. What I listed are the major capital investments. With CGA on the chopping block and Valleyfair a park the chain is likely looking to offload, it wouldn't make sense to make any major additions to either of them.
 
^ Right. I should've used a winky smiley or something. I just thought that the non-mention of their 50th anniversaries also happening in 2026 was telling.
 
Hixee said:
I'd love this to be true, but why does some sort of tenuous marketing ploy seem so much more likely...? :D
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I'm just hoping whatever it is has insane capacity seeing as the majority of their latest coasters have had really rough capacity. A shame they're probably not getting that insanely long multi launch coaster that was rumored for so many years that turned into full throttle.
 
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