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Cedar Fair Looking For Buyers--That Would Keep Bosses


The Interpreter
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While it's not completely unusual for private equity to retain management (or a lot of the management) in an acquisition, I can't imagine Blackstone, the Carlyle Group, Texas-Pacific, or anyone like them having that dictated to them as a condition of their investment... After all, shelling out between $3-4B should give you a little bit of say into a company's management! :D

It is generally thought that Matt Hart (Bollenbach's announced successor at Hilton) may very well be kept on board after the Blackstone acquisition. And, a few members of La Qunita's senior management were promoted up after Blackstone took them private a few years ago.

So, keeping members of senior management isn't impossible, but requiring it as a condition of the sale? (Didn't Kieran Burke try to make the same stipulation when he was looking for a buyer to fight off Dan Snyder...how'd that work out for him? :D )

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So what does this all mean? I'm confused.

It means they took on to much debt and the return on their investment is not paying off. I have a feeling they didn't want to wait until the end of the main season, because they are seeing some issues with attendance and income that are starting to build on their books.

Blackstone is still on a buying spree.

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Doesn't mean anything...yet. I wouldn't call them Six Flags Jr. just yet.

You wouldn't get a return on investment that would be of much significance after one year of ownership.

Yes, but because of the huge debt they needed to see a significant return on investment quickly. They talked a lot about streamlining operational expenses that would give a quick reduction in overall cost. Maybe that is not materializing as they had hoped.

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If true, this is certainly some very interesting news. Cedar Fair has been a public company for twenty years (they went public back in 1987). As a unit holder and park guest, it will be interesting to see if anything more develops out of this. It will also be interesting to hear their end of quarter conference call in August, to see if they mention anything about this latest development. At this point, I`d have to say that it is a wait and see what happens type of deal. If they get offers that are the right price, they may act on it. Also, as others have said, the management issue may be a big hurdle to overcome in any proposed deal.

On a side note, Cedar Fair`s units are up to $29.64, up 80 cents today, likely due to the article in the NY Post.

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I would say this was in the plans before they ever bought Paramount Parks. They've only owned them a year, and usually, by the time something like this is covered by the press, its been worked on for some time.

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I am so sick to my stomach about this...I never thought that Dick would be a sell out, but then I started to think about this. What if the board is not supporting Dick in all the things he wants to do with the parks to make them grow, then what else would you do about it. Look for someone to support you! I have had faith in Dick K for years and if he thinks this is a good move then in Dick K I trust.
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It will be interesting to see if this approach doesn't work for them if they try and sell some of the parks to reduce the debt.

I will not be happy with "Six Flags Kings Island"! Come there and The Vortex would break down so much they'd have it removed, and nothing new would ever be added, they'd put looney tunes on everything, etc it would not be pretty.

Anyway great company here! Cedar Fair was supposed to turn KI back to its old days, now we are finding the owners must have a LOT of faith in themselves!

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I am so sick to my stomach about this...I never thought that Dick would be a sell out, but then I started to think about this. What if the board is not supporting Dick in all the things he wants to do with the parks to make them grow, then what else would you do about it. Look for someone to support you! I have had faith in Dick K for years and if he thinks this is a good move then in Dick K I trust.

Please explain why you have such faith in Dick K?

I'm seriously curious as to why some seem to have an affinity for him. Now don't get me wrong, I'm so much happier that CF (at least for the time being) owns KI over Paramount, but I really don't see what Dick K has done that is even remotely special?

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I am so sick to my stomach about this...I never thought that Dick would be a sell out, but then I started to think about this. What if the board is not supporting Dick in all the things he wants to do with the parks to make them grow, then what else would you do about it. Look for someone to support you! I have had faith in Dick K for years and if he thinks this is a good move then in Dick K I trust.

Please explain why you have such faith in Dick K?

I'm seriously curious as to why some seem to have an affinity for him. Now don't get me wrong, I'm so much happier that CF (at least for the time being) owns KI over Paramount, but I really don't see what Dick K has done that is even remotely special?

Dick has done a lot for the company he has steadily grown the company since he has taken over. I can see him wanting to add more of a resort feel to KI and maybe the board is not supporting him in the big money items he wants to add. Dick K is not going to let anything happen to his beloved chain and his baby Cedar Point. I know that for a fact, he has so much pride in that company. I am guessing he is looking for support from a company to help him GROW! He has signed a deal to stay with the company to just sell it off it just don't make sense.

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I am so sick to my stomach about this...I never thought that Dick would be a sell out, but then I started to think about this. What if the board is not supporting Dick in all the things he wants to do with the parks to make them grow, then what else would you do about it. Look for someone to support you! I have had faith in Dick K for years and if he thinks this is a good move then in Dick K I trust.

Please explain why you have such faith in Dick K?

I'm seriously curious as to why some seem to have an affinity for him. Now don't get me wrong, I'm so much happier that CF (at least for the time being) owns KI over Paramount, but I really don't see what Dick K has done that is even remotely special?

Dick has done a lot for the company he has steadily grown the company since he has taken over. I can see him wanting to add more of a resort feel to KI and maybe the board is not supporting him in the big money items he wants to add. Dick K is not going to let anything happen to his beloved chain and his baby Cedar Point. I know that for a fact, he has so much pride in that company. I am guessing he is looking for support from a company to help him GROW! He has signed a deal to stay with the company to just sell it off it just don't make sense.

Yeah!

Cause Cedar Point And Knotts were nothing before Dick K. <G>

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I would say this was in the plans before they ever bought Paramount Parks. They've only owned them a year, and usually, by the time something like this is covered by the press, its been worked on for some time.

Actually, I'm pretty sure this is a direct result of the acquisition of Paramount Parks...more specifically, the $2B in debt they're now carrying on the balance sheet due to the acquisition.

This didn't come out in a press release--it was leaked...either on purpose (to try to get a boost in the stock price, which would open up a whole other can of worms), or by someone on the inside (either at CF or Bear Stearns) who shouldn't be talking.

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So did Cedar Fair take on to much debt buying the Paramount Parks? If so do you think that any of the parks will be sold off or closed for the sale of land?

Kinda had a felling this was going to happen last year. I just hope Kings Island stays open for years to come.

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It will be interesting to see if this approach doesn't work for them if they try and sell some of the parks to reduce the debt.

I will not be happy with "Six Flags Kings Island"! Come there and The Vortex would break down so much they'd have it removed, and nothing new would ever be added, they'd put looney tunes on everything, etc it would not be pretty.

Anyway great company here! Cedar Fair was supposed to turn KI back to its old days, now we are finding the owners must have a LOT of faith in themselves!

No I would not be happy with Six Flags Kings Island. But I would be happy with Busch Gardens Kings Island, or Kings Island a Herschend Family Entertainment Park or Universal's Kings Island. I know I am dreaming a little bit, but who knows. The only way for any of these three titles to happen is if CF decides to sell some parks (KI) seperately and not as a whole. None of these want to aquire the entire chain. I still think Blackstone might have some interest, if the Hilton deal doesn't over do it for them right now.

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