SeaWorld Entertainment says in brief statement there's "no path" to Cedar Fair transaction

Glad Cedar Fair rejected. Clearly, the offer was way too low given SeaWorld's admittance there is "no path to a transaction." Wonder what SEAS intent was in doing this - they surely had to know they were about $20/unit too low and FUN has a stable and deeply experienced board and management team - not sure there was much interest from FUN to join the Scott Ross show and revolving door of executives.

Interesting to me that it was SeaWorld and not Cedar Fair making the statement on the eve of Cedar Fair's Q4 earnings release. Seems odd to me CF would have went into that earnings call with no public statement on the matter, unless they planned to include commentary on it in their release.

In after hours trading Cedar Fair units dropped about 11.5%. SeaWorld down about 4.4%.

SeaWorld should have been comfortable with financing the acquisition at $60/unit. Additional $10 would add about $560 million of debt and $20 about $1.1 billion more debt. That may not have been something they thought they could get done. And trying to use SW equity may not have been something that Cedar Fair was interested in doing while at same time being something SW didn't think was dilutive.

I’m just glad it’s official. Now FUN may see this as a disaster averted, and may start to make plans to prevent a future scenario. Not necessarily bad for mgt to be aware, but don’t want them being Unit priced focused either

In a trivial sort of way I am also relieved. Obviously parks like Cedar Point and Kings Island would have found their way, but at what cost? And I would have hated to see a park like Dorney get Geauga Laked.

Zimmerman opened his comments with:

Thank you, Michael, and good morning to everyone on the call. We appreciate you taking the time to be with us this morning and hope you're all staying well. Before we get into our 2021 operating results and our outlook for the upcoming season 20 -- 2022 season, I'd like to address one specific topic. As we announced on February 1st and as confirmed in SeaWorld's statement yesterday evening, SeaWorld did make an unsolicited, non-binding proposal to acquire Cedar Fair.

The original proposal was for sixty dollars per unit, which they subsequently and informally increased to $63 per unit. Consistent with its fiduciary responsibilities, our board, together with its external advisors, carefully evaluated the proposal and determined it was not in the best interests of the company and its unitholders. As we will discuss this morning, the board and management have a high degree of confidence in our long range strategic plan. We look forward to reinstating a sustainable distribution to our unitholders, and we are confident that continued successful execution of our plan will result in meaningful per unit value creation.

That said, the board is open minded and always committed to acting in the best interest of unitholders. They will continue to consider any opportunities to create value for our unitholders. With regard to the SeaWorld proposal, we will have no further comment at this time. Turning now to our results for the fourth quarter and full year 2021, our opening remarks today will address three primary areas.

Reading between the lines, to me that says, "SeaWorld is a **** show and we can do better." And for all of my pricing complaints, I think that's true.

Not sure the statement would have been different if Cedar Fair thinks SeaWorld is well run. Statement (vetted by management, counsel, etc) was meant to protect the board/management and project confidence to the markets in Cedar Fair plan going forward.

yay