Apollo agrees to acquire Great Wolf Lodge
Posted
Investment manager Apollo Global Management said Tuesday that it agreed to acquire indoor water park operator Great Wolf Resorts for about $167.1 million. New York-based Apollo Global Management LLC will buy Great Wolf Resorts Inc. for $5 per share, which represents a 19 percent premium over the Madison, Wis.-based company's closing stock price on Monday.
Read more from WLWT/Cincinnati.
I really wish I had a better understanding of big time finance so I can better grasp why all of these PE firms are slowly getting into the amusement business.
Palace Entertainment, Merlin, Sea World Parks & Entertainment and now Great Wolf are all owned by huge, global PE firms. And Cedar Fair was very close not so long ago!
It can’t be for the growth because the industry has been mature in North America for years.
The cash flow is solid, but only for part of the year and is subject to huge risks and seasonality (weather, liability etc.).
It can’t be for the expenses because in general, the operating costs are very high compared to other industries.
Finally the amusement industry is so capital intensive, I just don’t see why these PE firms are seeing it as an investment strategy. If I ever win the lottery, the last place I would invest is in the amusement industry...and it is where I earn my living!
Someone clue me in please….where am I missing something?
Congratulations, Andy!!! You'll let us stay free....right?
The amusement park rises bold and stark..kids are huddled on the beach in a mist
http://support.gktw.org/site/TR/CoastingForKids/General?px=1248054&...fr_id=1372
Private equity firms typically will invest wherever they think they can get a good return. Over the past 2-3 years, there haven't been a lot of private equity deals so there is a lot of money on the sidelines looking to get into the game. Over the past 18-24 months, there have not been a lot of good deals available. So there have been a lot of PE firms looking to buy those few good deals which drives the purchase price up. That drives returns down. As a result, some PE firms start looking at less crowded space in the market. If you can get a good deal on a company that doesn't have huge growth potential, you may be able to produce better returns in your investment window (typically 3-5 years) than you can with overpaying for a company with higher growth potential.
Mike Gallagher said:
Congratulations, Andy!!! You'll let us stay free....right?
What do you think this is? A charity?
Hobbes: "What's the point of attaching a number to everything you do?"
Calvin: "If your numbers go up, it means you're having more fun."
I wonder if the deal had any "hidden" parachutes for the board.
Morté aka Matt, Ego sum nex
Dragon's Fire Design: http://www.dragonsfiredesign.com
Facebook: http://www.facebook.com/mattdrake
You must be logged in to post
