Let's address what might be the toughest question following the merger of the Cedar Fair and Six Flags theme parks. Which parks will end up closing as a result of the deal?
It's not a given that any parks will have to close once the merger is complete, which is expected early next year. This is a share swap deal that should not burden the company with excess debt that would need to be repaid. But the new Six Flags would have more than two dozen parks across North America, including some that will be adding only a tiny percentage to what shareholders hope will be a larger bottom line. As managers consider where to spend money on new rides and improvements in this capital-intensive business, it won't take long for people to recognize that the money might stretch further if there were fewer parks to maintain.
And closing a park can free its salvageable rides to relocate to remaining parks in the chain as "new" attractions.
The trick is to close (or sell) the parks whose loss would result in the smallest hit to revenue while delivering the highest possible return in a real estate or full-park sale. (Update: And a few parks are just operating agreements, where the company doesn't actually own the land. Noted by a * below.) Considering that, I have sorted the Cedar Fair and Six Flags theme parks into tiers, representing how seriously management might consider closing them.
Here are the seven parks listed in the recent TEA/AECOM Theme Index report as ranking among the Top 20 most visited parks in North America, in order of their estimated attendance.
These are the parks in the new Six Flags that have hit big with fans and that deliver substantial revenue to the company. Closing any of these would do real financial damage to the company - unless the new Six Flags got just a Corleone-style offer that was so much that they could not possibly refuse it. Still, damage would be done. It's just that the sale income might be worth more than the damage.
I don't see those offers incoming, so here are your seven untouchables in the new Six Flags chain:
These parks are knocking on the door of the Top 20 and have either received substantial recent investment or have well-regarded attractions that make them strong attractions beyond their local market. (Or both.) I have listed them alphabetically, but some clearly have stronger cases to be listed as untouchable than others. Carowinds, for example, is the home to the new Six Flags' corporate headquarters, and that's about a strong an endorsement of a park's security within the company as I can imagine. Six Flags Over Texas is also the original park in the original Six Flags company, as well as being located in the large Dallas/Forth Worth metro area (and it's a lease deal anyway).
Six Flags would not want to cede the growing San Antonio market to SeaWorld by closing Fiesta Texas, and the Georgia park draws well from the Atlanta metro. Kings Dominion is probably at the bottom of this tier, but it remains a strong park for the company, with multiple highly-ranked coasters.
Canada's Wonderland (above) is a definite untouchable, and the new company's two other international parks - in Montreal and outside Mexico City - likely count as too-valuable to cast aside given their locations in major markets, unless international legal and economic issues complicate their integration into the new company. But I will concede that I have not followed either park closely enough to pass judgment on them beyond that.
Now we get to the parks whose fans might begin to worry. A little over half of these parks are located in major metro areas, which offer the upside of access to many potential local visitors, along with the downside of potentially high real estate values that could make the parks a lucrative sales opportunity.
Six Flags New England isn't located within a major metro area, but in the northeast megalopolis, it's close enough to others that it fits in the same category as the parks immediately above.
That leaves four parks that are not lighting it up on attendance and aren't located in major metro areas. But would they attract enough money in a sale - either for land or the whole park - to make them worth closing right away?
That leaves us with the one park whose fate has been sealed - California's Great America*. Cedar Fair already decided to close the park, having sold its real estate to a Silicon Valley developer. The only question is whether the merger accelerates the end of CGA's up-to-10-year lease.
The impending demise of California's Great America might help move Discovery Kingdom onto the untouchable list, as CGA's closure leaves DK as the only major amusement park in the large and lucrative Bay Area market.
That leaves the new Six Flags to decide if it wants to keep two parks in Missouri, or two parks on either side of the DC/Northern Virginia market. Attendance and per cap spending data over the next year might determine whether several of these parks get to come back for 2025 and beyond, or if 2024 will be their final season of operation.
What would you like to see the new Six Flags do about its park line-up?
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