That strategy of rapid growth & expansion might've worked prior to 99 but over the past 7 years we've all seen the quality of the parks really take a nose dive with attendance & profits going right along with it...SFI as it currently stands is in a crisis situation here with the chain being the titanic after it hit the berg & Shapiro running around re arranging the deck chairs.He's in a difficult position here.
By closing the parks early they're certainly losing money....folks can't spend money at a park that's not open now can they?but due to the increasing pressure from creditors they're running low on the capital needed for daily operations & are forced to stretch their budget very tightly as a result.
The way I see it they might be forced to close all but the original three SF parks & if that were to happen then do something with the rides! don't just ship them off to one of their remaining parks only to leave them rotting in a field somewhere like they did with the three SFAW coasters....put those assets to good use immediately as a good cost cutting measure on cap ex spending.
I think if some of the other properties were liquidated, you'd have much more modern rides to work with in many cases.
By closing the parks early they're certainly losing money....folks can't spend money at a park that's not open now can they?
See, I think that these moves are being done to save money. You wouldn't close the parks if you were making profit!
The way I see it is that Shapiro & Co. are admitting defeat for the 2006 season and doing everything they possibly can to put themselves in a better situation for next season. This actually may be a good thing - if you can stop the hemorrhaging just long enough to make some money back with the sale of some parks at the end of the season, than you will be in solid shape for the start of next season.
If they actually pull off selling these 6 parks they could make close to a billion dollars. That's half their debt.
Of course on the other hand they could be very close to bankruptcy...
Magic Mountain Owner Seeks Package Sale
Six Flags aims to unload six parks as a set, making development of the Valencia site less likely.
By Roger Vincent, Times Staff Writer
August 19, 2006
Six Flags Inc. on Friday sent potential buyers detailed financial information on six of its amusement parks, including Magic Mountain in Valencia, after signaling its intention to sell the properties in a single transaction.
When the New York-based company announced in June that it might sell the parks to reduce its $2.1-billion debt, it listed options including selling one or more to theme park operators or dismantling the attractions and unloading the properties to real estate developers.
But on Thursday, Six Flags Chief Executive Mark Shapiro said that he would like to sell all six parks as a package, reducing the likelihood that Magic Mountain and neighboring Hurricane Harbor water park would be picked off by a local builder eager to blanket the land with homes.
In an interview with Bloomberg News after ringing the closing bell on the New York Stock Exchange to mark a change in the company's ticker symbol from PKS to SIX, Shapiro said Six Flags might keep the parks if it didn't get a good enough price.
"The real estate angle might be overrated," said Dave Omel, vice president of operations for Palace Entertainment Inc., a Newport Beach holding company for Raging Waters, Boomers and other entertainment centers. "If they did some work, these would be very viable theme parks."
For example, Magic Mountain could benefit from improved marketing and operations that would "make it nicer and more family friendly," such as implementing a dress code, Omel said.
Magic Mountain has a reputation for security problems and attracting rowdy teens. Shapiro has said he would like to make it and the company's 29 other parks more attractive to families.
In addition to Magic Mountain, Six Flags hopes to sell properties in Buffalo, N.Y.; Denver; Seattle; Houston; and Concord, Calif. Keeping them bundled would ensure that the less desirable parks are sold. The buyer could operate some and resell others for real estate development.
Development makes the most sense to another industry expert.
"There's very valuable dirt under some of these parks," said Carl Winston, director of the hospitality and tourism management program at San Diego State University. "Certainly that's the case at Magic Mountain."
The land in Buffalo and Houston might have little potential for development, but the four other parks are in thriving real estate markets, Winston said.
Local developers have expressed interest in creating a mixed-used project on the 250-acre Magic Mountain site with housing, retail and perhaps office space.
Parcels near the Valencia site sell for $750,000 to $1 million an acre, making the land on that property alone worth $200 million or more.
Shapiro has said that when evaluating which parks to sell he considered whether they were on valuable real estate. He also has said that the combined sale price would have to top $500 million to be worthwhile.
Six Flags' stock price fell more than 50% in the last six months but ticked up recently on Wall Street's assumption that the properties looked good to builders, Winston said.
"My speculation is that some real estate developer is thinking, 'Wow,' " he said.
Shares of Six Flags fell 6 cents to $4.99 on Friday.
That said bankruptcy protection might help in the short term by giving SFI a chance to at least restructure the terms of their debt payments....but in the end if they can't meet their payments to their creditors on time then they're still gonna be in a world of financial hurt.
There was something in the local news about SFDL and that the old snyder wanted to gobble it up fast, for sure, but in an interview, like this article says, they wanted to be sold as a group and that was out of the picture for the (old) owner.
It seems like a steal for 500 million for those six parks. I suppose it depends on what the real financial picture is for those parks. With LA County and Santa Clarita offering incentives to SFMM, and recent high levels of guest spending (despite continued shortcomings in park ops), along with Denver wanting SFEG to remain a park, it seems like those 6 parks would be a valuable assett to another operator.
I hope another entity does come in and scoops up those parks. I think once freed of SF management and choking debt., the three theme parks in the package would do quite well. Laronde might actually see some new rides, Denver wouldn't be saddled with bombs like Flying Coaster or Half-Pipe, and SFMM might have a chance at lasting improvement.
One has to wonder if the parks being part of a chain has actually helped them over the years, or instead has it hurt them?
"Six Flags has advised me that they prefer to sell six parks, as outlined in their press release, as a package, and that they're not going to deal with the individual properties until they're sure they can't sell the six together," Snyder said. He said he is only interested in buying the Darien Lake property, but is not discouraged about his potential to once again own the park.
so only if they don't sell together will they end up going seperate... qhich is unfortunate as I would like SFDL to be privately owned again
CF just spent huge amounts aqquiring Paramount,Busch certainly isn't looking to aqquire any new properties so who is there left to turn to as a possible buyer in the industry...aside from real estate developers of course?
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