Everything else goes here, including discussion of parks outside of Carowinds and any off-topic discussion
#107203
I wonder why they didn’t outright purchase Schlitterbahn in Kansas City. I mean it could be any number of reasons, from the Verrückt incident, to already having a presence in the market (WoF), but they have the right to acquire it.
#107204
Cedar Fair Entertainment Company (NYSE:FUN) to acquire two iconic water parks and one resort in Texas – Schlitterbahn Waterpark and Resort New Braunfels and Schlitterbahn Waterpark Galveston for a cash purchase price of $261M.

The company expects the two Texas locations to achieve an Adjusted EBITDA margin in line with it’s standalone results as management implements a number of growth and operational initiatives at the parks over the next two years, reflecting an accretive EBITDA multiple post synergies.

In addition to the two Texas properties, the company has the right to acquire a third site in Kansas City for $6M.

The transaction is expected to close during 2Q19.

The Company intends to finance the transaction through additional long-term borrowings.

FUN +1.12% premarket.


Very intrigued by this move! Glad to see Cedar Fair tap into the Texas market!

Now Cedar Fair can say they have the World's BEST amusement park and now World's BEST water park!

Thoughts??
#107205
Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.

They’re also not purchasing the company's other 2 Texas parks.
#107206
Hopefully they don't plan on "Geauga lake-ing" them lol. But seriously, these are some pretty "liberal" water parks. They have survived without many major modern slides. I wonder how many changes Cedar Fair will make to them?
#107211
Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.

The article makes it sound like they're only buying the land that formerly hosted a third park? Is that third location a currently operating park?

In addition to the two Texas properties, Cedar Fair has the right to acquire a third site, located on approximately 40 acres in Kansas City, Kansas, which previously operated as a Schlitterbahn water park, for a cash purchase price of $6 million.
#107212
Glitch99 wrote:
Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.

If that were the case, there'd be little reason to delay transfering the third park - when the whole deal closes, the $261M being paid would simply be disbursed to settle the debt attached to each of the 3 parks at closing.

My guess is that CF wants to digest these new acquisitions before deciding if they want to swallow yet another $100M debt that would come with this third park.


There’s every reason to delay. I’m assuming you’re not familiar with what’s going on with the Kansas park and how this works.

The Kansas park has $180 mill. In loans. CF obviously had valued the Kansas park at only $6m. If they purchase all three parks in one transaction, then not only are they purchasing assets, but also liability (the $180mill). Which means they’ve just inherited that debt for a park they don’t think is worth that much. CF is not looking to take on that liability. Obviously.

This is standard practice in corporate acquisitions, and there’s actually chatter in several places on line that this is the case.

So CF pays cash for the two parks that aren’t riddled with debt. Then the current owners pay off said debt. You know, the current owners that built a water slide at that park that decapitated a politician’s son and took on a lot of liability. The same current owners where one recently got caught with meth and hookers during the whole Verruckt investigation. Yeah. They sound like the type of people I’d trust up front to pay off those debts.

Which is why CF optioned it. Once the liability of loans are paid off, then CF has the right of first refusal to purchase the park.

Then Schlitterbahn will still have a few million dollars from the sell after they pay off the loans, and they’ll still have the third and fourth Texas parks to continue making money or shop around.

Cedar Fair isn’t going to pay that much for the parks AND ALSO take on the debt. Which is why they optioned the third park instead of purchasing it out right.
#107213
Glitch99 wrote:
Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.

The article makes it sound like they're only buying the land that formerly hosted a third park? Is that third location a currently operating park?

In addition to the two Texas properties, Cedar Fair has the right to acquire a third site, located on approximately 40 acres in Kansas City, Kansas, which previously operated as a Schlitterbahn water park, for a cash purchase price of $6 million.


Nice job editing your post to delete the entire thing. No, the article says “Additionally, Cedar Fair has the right to acquire A property located in Kansas City, Kansas, for a cash purchase price of $6 million.”

Not the property the park is on, the park as a property.
#107221
Edwardo wrote:
Glitch99 wrote:
Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.

The article makes it sound like they're only buying the land that formerly hosted a third park? Is that third location a currently operating park?

In addition to the two Texas properties, Cedar Fair has the right to acquire a third site, located on approximately 40 acres in Kansas City, Kansas, which previously operated as a Schlitterbahn water park, for a cash purchase price of $6 million.


Nice job editing your post to delete the entire thing. No, the article says “Additionally, Cedar Fair has the right to acquire A property located in Kansas City, Kansas, for a cash purchase price of $6 million.”

Not the property the park is on, the park as a property.

"...which previously operated as a Schilitterbahn water park."

Any comment can be spun to imply the commentor is an idiot, when you omit the relevant part of the comment.

And yes, they're buying the land. There is no operating park to be bought.
Last edited by Glitch99 on June 13th, 2019, 8:27 pm, edited 1 time in total.
#107222
Edwardo wrote:
Glitch99 wrote:
Edwardo wrote:Because the Kansas City park has over $100 million in debt. I’d imagine that once that’s paid, they’ll exceeding their option. The current owners are probably banking on the money from the sale to pay the debt, and once the debt is paid, CF will pay an additional 6 million to get the third park.

If that were the case, there'd be little reason to delay transfering the third park - when the whole deal closes, the $261M being paid would simply be disbursed to settle the debt attached to each of the 3 parks at closing.

My guess is that CF wants to digest these new acquisitions before deciding if they want to swallow yet another $100M debt that would come with this third park.


There’s every reason to delay. I’m assuming you’re not familiar with what’s going on with the Kansas park and how this works.

The Kansas park has $180 mill. In loans. CF obviously had valued the Kansas park at only $6m. If they purchase all three parks in one transaction, then not only are they purchasing assets, but also liability (the $180mill). Which means they’ve just inherited that debt for a park they don’t think is worth that much. CF is not looking to take on that liability. Obviously.

This is standard practice in corporate acquisitions, and there’s actually chatter in several places on line that this is the case.

So CF pays cash for the two parks that aren’t riddled with debt. Then the current owners pay off said debt. You know, the current owners that built a water slide at that park that decapitated a politician’s son and took on a lot of liability. The same current owners where one recently got caught with meth and hookers during the whole Verruckt investigation. Yeah. They sound like the type of people I’d trust up front to pay off those debts.

Which is why CF optioned it. Once the liability of loans are paid off, then CF has the right of first refusal to purchase the park.

Then Schlitterbahn will still have a few million dollars from the sell after they pay off the loans, and they’ll still have the third and fourth Texas parks to continue making money or shop around.

Cedar Fair isn’t going to pay that much for the parks AND ALSO take on the debt. Which is why they optioned the third park instead of purchasing it out right.


Maybe you should read what I wrote before assuming it's something stupid.

As I said, if there is debt attached to the third park, that requires the proceeds from the sale of the other two parks to pay off, there is no reason for a delay. Of course it's common to have debt attached to a property being purchased, that needs to be retired as part of the purchase. It gets retired as part of the purchase. It's an option, because CF doesn't know if they'll ultimately want it or not.

The option to buy Kansas City gives the company a chance to see whether the park is the right fit: “It’s something that we need to dig into more, and this gives us time to take a look,” he said.


In other words, Schlitterbahn included the option for The KC property as a sweetener, to convince CF to buy the two Texas parks and get them out of their cash crunch.
#107223
I did read what you wrote. You're just hell bent on being right when you're not.

Cedar Fair is interested in the KC park, which is currently not operating. That park not only has $180 million in loans against it, and likely liens from the financiers, but purchasing the park and the liabilities would also put CF in a position to owe the money to the financiers that could and should be paid for with the money from the sell of the other two properties that the actual company that owes the money would make to cover their debts. Any lawyer worth their weight in salt would tell CF not to purchase the KC park with that amount of debt. Are you trying to tell me that Cedar Fair is interested in paying $6 Million for the park AND THEN still paying an additional $180 million for the park? A park that isn't valued at that amount? Riiiiiiight. CF isn't going to take on that much of someone else's debt when THEY'RE PAYING FOR THE ACQUISITIONS with CASH. There'd be a revolt.

I talked to some people familiar with the deal earlier today. So I'm basing what I'm saying on facts.

You're not.

And please, stop deleting your posts and then reediting them to make it look like you said something earlier, when you didn't.

They're looking at buying another property. Are you HONESTLY saying that because the park isn't currently open, even though there is a park there, that CF is ONLY purchasing the LAND? Thats the dumbest reasoning I've seen. The whole park PROPERTY is still there. It just hasn't opened for the season yet.

I've followed the story of the KC park since before Verrukt. It's obvious you haven't. They want to get rid of it because they can't afford to keep it. Its a liability and there was a major death in the park. CF isn't going to purchase that park if there's outstanding debt that exceeds the park's worth, ESPECIALLY with the park's reputation.

You're really going to argue semantics that they may buy THE LAND, because the term PROPERTY was used? Cedar Fair refers to every park as a property.

My god. I can't with you...No Operating Park to be bought? Um, it simply didn't open for the year yet. You honestly don't think they're buying the entire park? Jeebus. That's pretty Dense.
#107226
The park closed as normal last season for the end of season. The park hasn’t opened for the season yet. I’m sure opening is up in the air at this point. But yes, it’s been operating up until last season.
#107229
Edwardo wrote:Cedar Fair is interested in the KC park, which is currently not operating. That park not only has $180 million in loans against it, and likely liens from the financiers, but purchasing the park and the liabilities would also put CF in a position to owe the money to the financiers that could and should be paid for with the money from the sell of the other two properties that the actual company that owes the money would make to cover their debts. Any lawyer worth their weight in salt would tell CF not to purchase the KC park with that amount of debt. Are you trying to tell me that Cedar Fair is interested in paying $6 Million for the park AND THEN still paying an additional $180 million for the park? A park that isn't valued at that amount? Riiiiiiight. CF isn't going to take on that much of someone else's debt when THEY'RE PAYING FOR THE ACQUISITIONS with CASH. There'd be a revolt.

Dude, this whole paragraph is pretty dense, if you want to start tossing insults.

Plenty of corporate acquisitions include the assumption of debt. It's pretty standard practice. $6 million is a very low valuation for an operating park, especially given that the other 2 in the deal average $135 million each and this one was built for far more than that just 10 years ago. So no, it isnt dense to wonder if that $6 million price is the net value of what's being purchased.

However, the reports indicate the sale is for the 40 acres of real property, which I also noted but you blew off as being stupid. Fact is, there simply is no goodwill included in the purchase price, they're buying a vacant property.

Regardless, if the $270 million cash being paid by CF is going to be used settle the liens on the Kansas property, that can all happen when closing the transaction. There is zero need for any delay in selling the Kansas property, when the cash being paid will cover the debts. In fact, reports indicate that the 2 parks being purchased are included as collateral for the EPR mortgage anyways, so what you claimed is delaying the third property would inherently be delaying the first two as well.

CF got an option to buy the Kansas water park property because at this point all they want is the option to buy it if they eventually chose to. The delay is not on the Schlitterbahn side of the transaction as you claimed, the debt has zero bearing on CF taking possession at the same time as the other two parks.
#107230
You’re really going to argue that they’re optioning to buy land and not a park?

It really doesn’t matter. You’re saying that there’s no reason that both transactions can’t be done all at once, for all three parks.

Cedar Fair disagrees with you. So no argument you make matters because the fact is the company doing the deal feels that there is a reason. Period.