Cedar Truthful and Six Flags will merge to create a playtime powerhouse in North America

Cedar Truthful and Six Flags are merging to create an expansive amusement park operator with operations unfold throughout 17 U.S. states and three international locations.

The mixed firm, price greater than $3.5 billion, will boast 27 amusement parks, 15 water parks and 9 resort properties within the U.S., Canada, and Mexico. It should even have leisure partnerships and a portfolio of mental property together with Looney Tunes, DC Comics and Peanuts.

Amusement parks have seen an uptick in income however have struggled to boost attendance for the reason that pandemic, whilst different leisure sectors have bounced again. A tie-up between two big gamers is anticipated to at the least decrease prices.

Cedar Truthful reported an attendance of 12.4 million company in its third quarter, a 1% enhance from a 12 months earlier. Six Flags introduced a 16% rise in its third-quarter attendance, which totaled 9.3 million company.

However amusement parks, together with Six Flags, has struggled to get folks by means of the gates, stated James Hardiman at Citi Funding Analysis.

“Whereas the theme park trade as an entire has been beneath important strain for the reason that begin of the pandemic, Six Flags has created extra strain of its personal, with a risky new attendance and pricing technique that has struggled to take root, alienating its core clients and resulting in dramatic drops in visitation alongside the best way,” Hardiman wrote.

Six Flags and Cedar Truthful, which have little geographical overlap, anticipate $120 million in price financial savings inside two years of closing the deal.

Six Flags and Cedar Truthful have talked about potential offers earlier than, with Six Flags beforehand making a suggestion for Cedar Truthful in 2019, but it surely was turned down. SeaWorld approached Cedar Truthful with a bid final 12 months, however that proposal was additionally rejected.

Underneath the settlement introduced Thursday, Cedar Truthful unitholders will obtain one share of widespread inventory within the mixed firm for every unit owned, whereas Six Flags shareholders will obtain 0.5800 shares of inventory within the mixed firm for every share owned.

Cedar Truthful unitholders will personal roughly 51.2% of the mixed firm, whereas Six Flags shareholders will personal about 48.8%.

“Our merger with Six Flags will deliver collectively two of North America’s iconic amusement park firms to determine a extremely diversified footprint and a extra sturdy working mannequin to boost park choices and efficiency,” Cedar Truthful CEO Richard Zimmerman stated in a ready assertion.

Zimmerman will likely be president and CEO of the mixed firm. Selim Bassoul, president and CEO of Six Flags, will grow to be govt chairman.

The businesses stated that given their broader geographic footprint as a single firm, seasonal volatility ought to average.

The corporate’s newly shaped board will embody six administrators from Cedar Truthful and 6 administrators from Six Flags.

The corporate will likely be headquartered in Charlotte, North Carolina, and can hold important finance and administrative operations in Sandusky, Ohio, the place Cedar Truthful relies.

Six Flags is now based mostly in Arlington, Texas.

As soon as the deal closes, the mixed firm will function beneath the identify Six Flags and commerce beneath the ticker image “FUN” on the New York Inventory Alternate.

The transaction, which was accredited by each firms’ boards, is focused to shut within the first half of subsequent 12 months. It nonetheless wants approval from Six Flags shareholders.

Shares of Six Flags Leisure Corp. and Cedar Truthful LP have been basically flat earlier than the opening bell Thursday, however each are up greater than 9% this week after rumors of a deal started to unfold.