Cedar Fair to go ahead with Apollo Global deal
Cedar Fair LP said Tuesday that it is proceeding with its proposed $635 million acquisition by asset manager Apollo Global Management.
The amusement and water park operator said in a filing with the Securities and Exchange Commission that it reached out to 32 other potentially interested parties during the 40-day period in which it was allowed to try to find alternative bids. In that time Cedar Fair, based in Sandusky, Ohio, said six of the parties wanted confidential company information in order to evaluate a possible deal but none of them wound up making an offer.
Now that the go-shop period has ended, Cedar Fair said in the filing that its board still believes the proposed deal with Apollo maximizes value for its unitholders.
Cedar Fair owns and runs 11 amusement parks, six outdoor water parks and five hotels, including Cedar Point in Ohio, Canada’s Wonderland near Toronto, Dorney Park in Pennsylvania and California’s Knott’s Berry Farm and Great America.
The potential acquisition comes at a time when the company has struggled to keep consumers coming to its properties. With the economy still fairly fragile and unemployment numbers high, many consumers have pulled back on their discretionary spending, which has pushed amusement and water park attendance levels lower.
Even rival theme park operator Six Flags has succumbed to recessionary pressures, filing for bankruptcy protection in June.
Cedar Fair accepted Apollo’s $11.50 per share offer last month. The transaction’s total value is estimated by the companies at $2.4 billion, which includes the assumption of debt.
At the time Cedar Fair agreed to the acquisition, the offer price was a 27 percent premium to its closing stock price of $9.08. The shares fell 29 cents, or 2.3 percent, to $12.49 Tuesday morning, or 8.5 percent above the offer price.
The acquisition is expected to close by the start of the 2010 second quarter. It is dependent on regulatory clearance and holders of two-thirds of the company’s shares supporting the transaction.