Daniel Snyder considering purchase of all or part of Six Flags

Posted Monday, April 25, 2005 11:51 AM | Contributed by supermandl

Daniel Snyder, owner of the National Football League's Washington Redskins, said Friday, April 22, he might be interested in buying some or all of amusement park operator Six Flags Inc. Snyder, who owns about 8.75% of Six Flags through his Ashburn, Va., hedge fund Red Zone LLC, said he might also attempt to influence the Oklahoma City-based company's board and management through a proxy fight to consider any of several options, including a merger, a sale of assets, a business combination, and recapitalization or refinancing, according to a Securities and Exchange Commission filing.

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Monday, April 25, 2005 11:57 AM
I thought he sold his shares of Six Flags a couple months ago? I guess he just wrote the stupid letter and that was it. :)
*** This post was edited by MDOmnis 4/25/2005 12:00:51 PM ***
Monday, April 25, 2005 11:58 AM
"Perhaps Six Flags' most salable asset is its Jackson, N.J., park, whose proximity to New York and Philadelphia could lead it to fetch as much as $800 million."

So if Snyder buys Six Flags, does anyone think they'll actually sell SFGAdv, especially after all of the improvements and additions they've just made this year? Go ahead...sell off one of your best (if not the best) park in your chain, and see what it does for business...

Monday, April 25, 2005 12:14 PM
I say split the park down the middle of the country, and North and South. Try to sell those four regions as separate companies. Then you have four companies. Or sell each park by itself. Let America have at it.
Monday, April 25, 2005 12:24 PM
sirloindude's avatar I think a merger would be in the best interest of Six Flags. Call me a fanboy, but a merger between Six Flags and Cedar Fair might be a good idea. However, it's only good if Cedar Fair gets to make the most important decisions.

Anyway, I also think a merger would be a great idea because CF wouldn't have to spend so much money and find themselves with too much to handle. A merger would be far more effective from a financial perspective.

Monday, April 25, 2005 12:37 PM
It is possible that Snyder will buy out Six Flags Inc. Its been talked about in the Washington Post a few times (mentioning SFI including SFA since its only about 10 mins from FedEx Field). He is a Real Smart business man along with Bill Gates. If the parks starts to fail again this year, Snyder will buy out the company. He can turn the chain around with new additions to every park and not just the flagship parks. Just improving the flagship parks doesn't make the chain as a whole better. Its good to have changes!!!!

A merger is good to for this chain. Ex. Cedar Fair. Snyder do your Stuff!!!!*** This post was edited by SF Critic 4/25/2005 12:45:48 PM ***

Monday, April 25, 2005 1:40 PM
Jeff's avatar I don't think they guy would be good for the company. The things he has said make it sound like running theme parks is like running a football team. Even we know better than that.
Monday, April 25, 2005 1:56 PM
But considering that the Washington Redskins are the among the most profitable teams in the NFL (despite not having won the Superbowl in years), his influence may not be such a bad thing. As long as he knows how to get the right people to run the company or knows how to get the current people to do just that, I see this as good news.
Monday, April 25, 2005 1:57 PM
I'm not sure I understand his motivation...? But I certainly do not think this guy would be good for Six Flags directly. Indirectly, he may be good for the business in general. I have a hunch that his plan is to sell off a lot of the underperforming parks. I think this could be good for those of us who enjoy diversity in our park offerings. Whatever happens, I think it is safe to predict that Six Flags as we know it, will look a lot different 5 years from now. I see no way they can continue to compete...
Monday, April 25, 2005 1:59 PM
But perhaps a buyer for the smaller parks would properly invest in them, which is something SF has been unable/unwilling to do considering its recent financial woes?
Monday, April 25, 2005 2:05 PM
"or even to real-estate developers"

These words should scare the living daylights out of those who live near the small and struggling members of the Six Flags family. Believe me, it is a lot easier to find a buyer from the "real-estate developer" ranks than it is to find buyers interested in running amusement parks. Me-thinks Snyder et al may not be too interested in perserving the charm and history of some of these parks. Lets just say that a little reading between the lines makes me pray that CedarFair is in the market for some huge expansions. Without them to the rescue, it seems a safe bet that the census for American amusement parks is ready to start a decline...

Monday, April 25, 2005 2:38 PM
It would seem to me that he is going for it while they are down for the count. (Isn't this similar to the attempt by Comcast to takeover Disney?)

He clearly realizes that he could buy the chain and turn around and sell the smaller money losing parks for a profit to developers. Other parks such as Great Adventure also have tons of land he could sell off and still keep the park. A win-win situation for Snyder.

As far as I'm concerned, this is bad news. He is a smart business man and I'm very sure that he does not have the best interest of these parks in mind.

So I 100% agree with Jeffrey R Smith in that this should scare the crap out of those living near the smaller parks.

Monday, April 25, 2005 5:09 PM
Snyder markets the crap out of the Redskins. You can only buy season tickets with a Master Card. $25 to park in General Park not within walking distance of the stadium. You have to pay a $800 fee + $75 fee to be part of the taitlgate club which is nothing more than a all you can eat buffet, yet people pay for this stuff in the name of being a Redskins Fan.

I believe Snyder has the marketing sense to get money out of people in amusement parks. As for the business side, he didn't know anything about football when he purchased the Redskins and was the youngest owner of a NFL team at the time of the purchase. However, he went out and hired people that new how to run a football team and just when he was about to be run out of town, he hires Joe Gibbs, a fan favorite.

I have no doubt if he was to purchase SF, he would hire advisors from within the industry that would tell him how to run the company.

Monday, April 25, 2005 5:48 PM
If he runs Six Flags like he runs the Redskins, they will be worthless in less than 5 years. The Redskins are without a doubt the worst run franchise in the NFL.*** This post was edited by Sugart 4/25/2005 5:50:16 PM ***
Monday, April 25, 2005 6:06 PM
Actually Sugart, the Redskins are one of the most valued professional sports franchises in the USA. I don't have time to get a link right now (anybody up to the challenge), but I'm pretty sure they are #1 or maybe #2 to the Yankees. From a business standpoint, thy are as profitable as they come. His onfield moves may be dumb, but his business sense is second to none. Do not confuse the two.

If you apply the parallels to Six flags, you can easily see why amusement park enthusiasts should be worried. I've no doubt, Snyder can make Six Flags more profitable. However, at what expense will this profit come? Read between the lines and it is obvious Snyder plans a sell off.

And if Snyder does not gain control, it is just a matter of time before somebody else does the same. Six Flags has taken on so much debt, that I see no way that all the parks in the chain can ever survive...just my opinion...

Monday, April 25, 2005 6:40 PM
Jeff's avatar Getting money out of people isn't an issue at amusement parks, it's getting people into them in the first place, then getting them spending money. This is not a football team. Six Flags doesn't have the same emotional tie. His stupid marketing ideas about tying in with the video game crowd is the kiss of death... Six Flags already has them and they don't spend any money. It's all about mom, dad, 2.2 kids, lots of cotton candy.

Snyder complained about the amount of capital expenditures. Come on... that's par for the course in amusement parks, and to Six Flags credit they've managed to do that right. It's the service, stupid!

Six Flags already has the product. The product and the marketing message are fine. It's the condition of the product that is an issue.

Monday, April 25, 2005 7:23 PM
I agree with you 100% Jeff! Maybe you can buy the chain? :-)

I just fear that rather than put the hard work into changing the service problem, the easy fix is to sell off the under-performers. This is as old as time in the business world. I'm sure Snyder sees a quick and easy buck in the real estate market. If not Snyder, then somebody else will try the same. Anyhow, it does not take a genius to see them sneaking "or even to real-estate developers" in the middle of the article to see what the plan is.

The sad fact is that Six Flags has been run into the ground to the point in which they are now quite vulnerable to the likes of Snyder and his tactics. Their little service problem has left the small fish in a very dangerous position. Stockholders would be glad to get value from anywhere, including real estate. Let us hope the likes of Cedar Fair or some rich individuals/businesses with an amusement park itch can step up and save the day.

Monday, April 25, 2005 8:51 PM
Even though Six Flags really didn't show us their best in 2004, but they did add alot of additions in 2005. It is possible they can turn the theme park around but it won't take 1 year.

As for some SF parks being lost if Snyder buys out? Trick Question!

Synder might also attempt to influence the Oklahoma City-based company's board and management through a proxy fight to consider any of several options, including a merger, a sale of assets, a business combination, and recapitalization or refinancing, according to a Securities and Exchange Commission filing.

Land that Six Flags will never use can be sold to real-estate developers. SFGAdv has about 2,000 + acres that will probably will be never used in the future. Sell most of that land. Now I dont know how much land they are currently using between the theme park, water park, and animal safari, but I know they still have alot of land.

SFI needs to merged with someone but who? I think the best decision is Verizon. Its only if Verizon is interested in the parks. If you don't know Verizon is the largest phone company in the world (broadband, wireless, regular phone). This company can stand on its own. They don't need to merge like Cingular/AT&T. Verizon is the Father. They just bought out MCI. They do have a deal with Directv in some way because when you get internet it comes with the TV service. I know there are other services that are good out there. So what do you think?

Snyder can make this a tough fight, and it can either become a freindly merger type of deal, or a hostile takeover. Whatever happens, the stock price can only go up.

Something gotta give, and it's gonna happen soon.

Monday, April 25, 2005 9:47 PM
Personally I would hate to see a merger between CF and SF, I am a huge fan of CF. I think their parks are run great and have a great atmosphere. I believe a big part of this has to do witht he size of CF. It really doesn't have all that many parks to manage which means each park is noticed for its local needs. If SF merged with CF there would be way to many parks and each park would be treated like SF is treating them. Ok this park got a waterpark, now this one gets one, now this one. They don't seem to notice the local needs as much. This isn't meant to put down SF I still love going to SF every year but I think CF is much bette and managing their parks and if SF was thrown in it would only hurt CF. Personally I would like to see each park sold seperatly so each park can get the much needed individual attention it need.

P.S. If CF would like to buy SFGAm though that would be 100% ok with me.

Monday, April 25, 2005 10:13 PM
Jeff's avatar The worst part about selling off parks is that it has a quick shot of cash to put toward debt (unless you let yourself get screwed the way they did in the SFWoA sale), but then you also remove a source of revenue. Granted, you have to turn a profit with that property, but I can't think of any property that is completely without potential.

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