RailRider Posted September 19, 2011 Share Posted September 19, 2011 More to Follow Quote Link to comment Share on other sites More sharing options...
RailRider Posted September 19, 2011 Author Share Posted September 19, 2011 SANDUSKY, Ohio, Sept. 19, 2011 /PRNewswire via COMTEX/ -- Cedar Fair (NYSE: FUN), a leader in regional amusement parks, water parks and active entertainment, today announced that it has entered into a definitive agreement to sell its California's Great America amusement park, located in Santa Clara, California, to JMA Ventures, LLC ("JMA") for $70 million in cash. The Company, which purchased the park in 2006, expects to use the cash proceeds from this sale to reduce its senior secured debt. "Our decision to divest of our California's Great America park was not an easy one," said Dick Kinzel, Cedar Fair's chief executive officer. "This is a quality park that has terrific employees and serves a strong market. That being said, as part of our regular comprehensive review of our portfolio of parks, we determined that divesting a smaller park like California's Great America at an attractive market value created a compelling business opportunity that we couldn't pass up. Among other things, it provides us the opportunity to immediately de-lever our balance sheet resulting in additional financial flexibility for growth and unitholder value creation in the future. California's Great America and its employees have always demonstrated tremendous capability in providing its customers with the highest level of family entertainment in the northern California region. I'm confident the park and its employees will continue to thrive under the ownership of JMA." "As we look toward 2012, we are building significant momentum for Cedar Fair to deliver consistent and meaningful distributions to our unitholders," said Matt Ouimet, Cedar Fair's president. "At the same time, we remain committed to driving top-line growth through a combination of new rides and attractions, marketing initiatives and related strategic expansion around our entire portfolio of premier entertainment venues. The divestiture of California's Great America will provide us with additional financial flexibility earlier than anticipated to achieve these goals and maintain Cedar Fair's position as one of the most attractive growth and yield stories in the leisure and hospitality industry." The transaction, which is subject to approval by the City of Santa Clara and customary closing conditions, is expected to close in the fourth quarter of 2011. Cash proceeds received at closing are expected to be applied to the Company's senior secured debt under the terms of the Company's credit agreement. A Form 8-K with the material terms of the definitive agreement will be filed with the Securities and Exchange Commission by the end of day Tuesday. California's Great America is northern California's leading amusement park, with more than 50 rides and attractions. JMA Ventures, LLC is a California-based full service real estate investment firm, serving as managing partner of over $500 million in existing projects spanning hospitality, leisure, residential developments, retail, office and industrial/telecom. About Cedar Fair Cedar Fair is a publicly traded partnership headquartered in Sandusky, Ohio, and one of the largest regional amusement-resort operators in the world. The Company owns and operates 11 amusement parks, six outdoor water parks, one indoor water park and five hotels. Amusement parks in the Company's northern region include two in Ohio: Cedar Point, consistently voted "Best Amusement Park in the World" in Amusement Today polls, and Kings Island; as well as Canada's Wonderland, near Toronto; Dorney Park, PA; Valleyfair, MN; and Michigan's Adventure, MI. In the southern region are Kings Dominion, VA; Carowinds, NC; and Worlds of Fun, MO. Western parks in California include: Knott's Berry Farm; California's Great America; and Gilroy Gardens, which is managed under contract. Forward-Looking Statements Some of the statements contained in this news release constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995, including statements as to the Company's expectations, beliefs and strategies regarding the future. These statements may involve risk and uncertainties that could cause actual results to differ materially from those described in such statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Important factors, including general economic conditions, adverse weather conditions, competition for consumer leisure time and spending, unanticipated construction delays and other factors discussed from time to time by the Company in reports filed with the Securities and Exchange Commission (the "SEC") could affect attendance at our parks and cause actual results to differ materially from the Company's expectations. Additional information on risk factors that may affect the business and financial results of the Company can be found in the Company's Annual Report on Form 10-K and in the filings of the Company made from time to time with the SEC. The Company undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise. This news release and prior releases are available online at www.cedarfair.com. Contact: Stacy Frole, (419) 627-2227 SOURCE Cedar Fair Entertainment Company www.prnewswire.com Copyright © 2011 PR Newswire. All rights reserved -0- Quote Link to comment Share on other sites More sharing options...
bkroz Posted September 19, 2011 Share Posted September 19, 2011 http://www.jmaventuresllc.com/ At this price, I may have preferred to see its rides removed and divided among the remaining parks. Especially given that I'm tremendously jealous that that $70 million will go toward debt reduction and not park improvement (which I realize is extremely unfair of me, haha!). Still sad to see it go - and now, one must wonder what JMA plans. Destination entertainment seems to be their "thing," but are they a large enough corporation to fight the ongoing battle to keep Great America afloat? Do they intend to keep it open as an amusement park when their portfolio is entirely resort hotels, homes, and restaurants? And that begs the question - what would happen to the ride names? Can they possibly get any more generic than Flight Deck, or Drop Tower, or Vortex? Passes are already on sale for Great America for the 2012 season, but that doesn't mean much... So strange to think that two parks could begin so similarly under Marriott, then diverge - one under Six Flags, and one under Kings Entertainment, Paramount Parks, Cedar Fair, and now, perhaps JMA Ventures. P.S. According to Wikipedia (I know, I know), in 1983, the park was valued at $1 million per acre (it's a 100-acre property) with the city paying $93 million just for 80 acres of it... Again, that was 1983. Quote Link to comment Share on other sites More sharing options...
RailRider Posted September 19, 2011 Author Share Posted September 19, 2011 Cedar Fair wins in this deal. They are out from under the uncertainty of the land issues with the park, dealing with the city and the 49ers. Also $70 M in cash to go towards Senior debts is great news for shareholders and for the financing capabilities of the company. Also Ouimet has already been a part of some big changes at Cedar Fair since he has stepped in. I am not sure how much of these actions are his doing or are Kinzel's last actions before stepping down. Interesting non the less. Quote Link to comment Share on other sites More sharing options...
Pagoda Gift Shop Posted September 19, 2011 Share Posted September 19, 2011 Well, I was hoping that KI would get the B&M Invert when it closed. I guess that won't be happening, eh? 1 Quote Link to comment Share on other sites More sharing options...
RailRider Posted September 19, 2011 Author Share Posted September 19, 2011 The details are still somewhat vague. I am not completely sure that the park is being sold with all rides or if it is more of a land purchase by JMA Ventures. Should be interesting to see what their plans are for the park, and future opperations of said park. Quote Link to comment Share on other sites More sharing options...
CoastersRZ Posted September 19, 2011 Share Posted September 19, 2011 Well, the land is owned by the city of Santa Clara. Cedar Fair simply had a long term lease on the land. So I would assume that the sale price includes all assets that are located on the leased land. It is good that the proceeds will be used to pay down existing debt for Cedar Fair. Yes, it is sad that a park like this is leaving the Cedar Fair family (and means that a Platinum Pass is not quite as valuable as it once was). But hopefully it means that Cedar Fair is in a better financial position than they were in prior to the divesture of the park. If I had to have my choice, and if KI ever gets a B&M inverted, I`d rather KI get a brand new design, than a relocated design from another park. Just saying... 1 Quote Link to comment Share on other sites More sharing options...
Colonel_SoB_fan Posted September 19, 2011 Share Posted September 19, 2011 Sounds like a win-win according to this article http://www.bizjournals.com/sanfrancisco/blog/2011/09/jma-acquires-santa-clara-49ers-stadium.html. Also this article makes sound like the decision was made by Kinzel. http://www.bizjournals.com/columbus/news/2011/09/19/cedar-fair-sheds-californias-great.html Quote Link to comment Share on other sites More sharing options...
IndyGuy4KI Posted September 19, 2011 Share Posted September 19, 2011 The details are still somewhat vague. I am not completely sure that the park is being sold with all rides or if it is more of a land purchase by JMA Ventures. Should be interesting to see what their plans are for the park, and future opperations of said park. He have kind of seen this coming. Since a few rides have left the last few years, maybe they got the rides they wanted first ? Quote Link to comment Share on other sites More sharing options...
bkroz Posted September 19, 2011 Share Posted September 19, 2011 I thought this was timely and interesting: Shane's Amusement Attic (over at Theme Park Review) has uncovered some images from when Paramount intended to build their own "CityWalk" style entertainment district within Great America called "Front Gate." In a way, it looks like a prototype California Adventure - famous landmarks and districts represented that all create a very shopping / entertainment friendly area that leads up to the park's front gate. It's too bad this never came to be, but in retrospect, perhaps it's a good thing. Even Kings Island, as the flagship park, couldn't have supported or justified something like this when you really think about it, so what a waste it would've been at Great America. 1 Quote Link to comment Share on other sites More sharing options...
Leland Wykoff Posted September 20, 2011 Share Posted September 20, 2011 Well, now this transaction explains a lot. Great America was sold to reduce the uncertainty of, and secure a certain payment for, the asset. Given the threat of eminent domain to take the lease from Cedar Fair this establishes a price. Reports seem confused as to whether JMA Ventures also acquired the management contract for Gilroy Gardens. Cedar Fair spokesperson Stacy Froley has been quoted as saying the deal included the Gilroy management contract. Confusion is swirling around this point. Perhaps Ms. Froley inadvertently let the cat out of the bag concerning a management contract with JMA to continue operating Great America. Given Cedar Fair had a loss last year, due primarily to the right-off of a large part of the value of Great America. That right down, in the fourth quarter of 2010, was for a $62.4 million dollar impairment charge, attributed to lower than expected performance at Great America. JMA Ventures deal is reported to also involve the York family, owners of the San Francisco 49ers, and has been purchased to pave the way for stadium and parking expansion on the property controlled by Cedar Fair. It is possible Cedar Fair may receive the contract to manage Great America until such time as stadium redevelopment takes place. That the impairment charge of $62.4 million dollars last year is almost equal to the size of the sale price of $70 million dollars speaks volumes about the inflated price Cedar Fair paid for the former Paramount Parks. The cash out will allow Cedar Fair to improve the liquidity and balance sheet. Chalk this bit of financial wisdom up to our new President and CEO, in waiting, Matt Ouimet. Quote Link to comment Share on other sites More sharing options...
KIfan1980 Posted September 24, 2011 Share Posted September 24, 2011 While a relocated ride to KI would have been nice, I agree with the win-win tag on this. Cash to help the CF financial position and elimination of CF as a barrier to 49ers stadium construction. While the stadium is still a ways off - getting this done now doesn't hurt. Quote Link to comment Share on other sites More sharing options...
Colonel_SoB_fan Posted December 3, 2011 Share Posted December 3, 2011 http://espn.go.com/nfl/story/_/id/7310317/san-francisco-49ers-santa-clara-secure-funding-stadium What does this mean for CGA? Quote Link to comment Share on other sites More sharing options...
The Interpreter Posted August 30, 2015 Share Posted August 30, 2015 Just a reminder of what the Kinzel era was like. "Lest we forget." 5 Quote Link to comment Share on other sites More sharing options...
Honorarius Posted August 30, 2015 Share Posted August 30, 2015 http://www.jmaventuresllc.com/ At this price, I may have preferred to see its rides removed and divided among the remaining parks. Especially given that I'm tremendously jealous that that $70 million will go toward debt reduction and not park improvement (which I realize is extremely unfair of me, haha!). Sooner or later, that money had to be repaid... Why push it off and continue to pay interest when you have the chance to get out from under some of your debt??? Quote Link to comment Share on other sites More sharing options...
The Interpreter Posted August 30, 2015 Share Posted August 30, 2015 Historically low interest rates? 2 Quote Link to comment Share on other sites More sharing options...
shark6495 Posted August 30, 2015 Share Posted August 30, 2015 Historically low interest rates? Yup! We were told with our house, we were better off paying off other debts or use it for other things since our interest rate is almost negligible.... 3 Quote Link to comment Share on other sites More sharing options...
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