Six Flags Declares Bankruptcy

So is this something that'll make Kinzel super happy or what?

Why would this have any effect on Kinzel? This action has been seen as fairly inevitable for some time. But this doesn't mean that Six Flags is going away. This is a Chapter 11 Bankruptcy, not a Chapter 13 liquidation. Shapiro fully expects to keep the chain going through the proceedings, and if anything will emerge stronger and in a better fiscal position than it is now.

Even if SF were to go under, there aren't many markets where Cedar Fair and Six Flags compete. So it's not like CF would benefit hugely from a liquidation.

Cedar Fair could gain well known six flags parks, like Six Flags over Texas, or Six Flags Great America for really cheap. Or buy individual rides and coasters for almost nothing.....

Six Flags isn't going anywhere. And frankly, it's not good for Cedar Fair in any way, because it casts a lot of darkness on the industry in general, and it will hurt the unit price just on association. Cedar Fair isn't exactly debt free either.

They are not going anywhere like someone else said.

They will re-structure and refinance their debt. That's not to say there might not be major budget cuts (aka not as many new attractions, getting rid of high maintenance stuff).

SIX has been in trouble for a long time though. Their bankruptcy was easily predicted by many people I think.

...Including Six Flags themselves. This bankruptcy is no surprise; the only real question in the mind of anybody paying attention the last year or so has been "when". And the answer to that question seems to be "now".

And Jeff has an excellent point. Investors are, for the most part, not amusement park enthusiasts as we are. It is an industry they don't even watch most of the time, and so far as The Market knows, Six Flags is still the 900-pound gorilla in the amusement business, and more important, it is still the Six Flags of 1993. That the company has been through acquisition, expansion, divestment, and a hostile takeover since then doesn't even register. Nor does the fact hat Cedar Fair today is bigger than Six Flags was back then.

On the day that Premier Parks offered up 1.9 billion dollars for the outright purchase of Six Flags, do you know what the financial news headline was? The big news was about some merger of tech companies that most of us have never heard of, in a spectacular deal estimated at about $125 million. The Premier/Six Flags deal had a lot more zeroes and involved companies that a lot more people know about...and if you weren't specifically following the amusement industry news, you would never have heard about it.

--Dave Althoff, Jr.

I still imagine Dick Kinzel having a little "I Win" party in his office.

What universe do some of you live in that you actually think the two companies spend a lot of time worrying about each other?

It will be interesting to see what kind of deal SF can work out with their debt holders that the court will approve. I would expect that some of their parks will be sold off or liquidated. Which ones were the worst performers financially I wonder?

Also, did they have any new rides under construction? If so, those will be stopped in their tracks unless the vendors get assurances they will be paid.

Expect continued efforts by Cedar Fair to clean up their balance sheet.

I don't think there's anything to be interested in... the deal has already been outlined, and it doesn't involve selling anything. The poor performers were already sold.

I wonder if Cedar Fair will try to use this as leverage to get their creditors to take less than the full dollar on their debt as they unsuccessfully tried to do several months back?

^^^

The SF bond holders will become SF shareholders. The current SF shareholders will either find themselves owning a FAR smaller % of the stock or be SOL entirely

If they were to sell any parks,it think it would be: Six flags St. Louis, Maryland,& Kentucky Kingdom. It doesn't look like they will have to sell anyparks yet. Does anyone think that Cedar Fair bought Geauga Lake because they wanted to get rid of competion for CP? It sounds wierd but if it was true, they might buy sf maryland and close it down a few years later to get rid of competioton for Kings Dominion. I might be wrong about GL because cedar fair said they closed it down because of low attendance, wich probaly was true! :)

They don't have anywhere near the cash to pay this off and have "maxed out their credit cards".

I'm really curious to see what the debt holders are agreeing to.

I'm sure CF has taken notice of this corner SF painted themselves into and are/will be working to make sure their debt is more servicable.

I think folks here tend to view Cedar Fair and Six Flags as fierce competitors and while they do compete with each other, it's not nearly the level that folks think. It's different when you are a retailer, newspaper, or something like that. They compete in the same city and sometimes the same mall as each other. They are in close proximity. Cedar Fair and Six Flags may occupy the same state, but rarely are they in such a close proximity that they have to worry about the other. And even if they do, it's more about that individual park winning more guests than the company as a whole.

But on the corporate end of it, there isn't competition to that level. People generally visit the park closest to them.