“As far as we’re concerned, it’s business as usual,” she said. “We’re the same company we were on Monday and it’s the same company we are today and will be in the future.”
Apollo Global Management officials said today, Dec. 17, they are committed to growing the to-be-acquired amusement parks, including Kings Island.
Kings Island owner Cedar Fair will merge with New York-based Apollo Global Management in a deal valued at approximately $2.4 billion. Cedar Fair agreed Wednesday, Dec. 16, to be acquired by the asset manager for about $635 million in cash. The company also will assume the estimated $1.6 billion in debt Cedar Fair had on its books as of the third quarter this year, Frohle said.
The acquisition capped a year in which the struggling economy led to the drop-off of more than a million visitors to the company’s amusement and water parks and it saw a rival succumb to bankruptcy protection.
The $11.50-per-share offer marks a 27 percent premium to Cedar Fair’s $9.08 closing stock price Wednesday.
“We have considered a wide range of strategic alternatives over the past several years,” said Dick Kinzel, Cedar Fair’s chairman, president and chief executive officer. “After considering these strategic alternatives, we have concluded that the transaction with Apollo is in the best interest of our unit holders.”
Apollo wants to see Cedar Fair continue to grow in the amusement park industry, said Aaron Stone, an Apollo senior partner.
“We are extremely pleased to be acquiring this premier amusement park operator,” he said. “We look forward to partnering with Cedar Fair’s management team and employees to build on the many strengths of the company. We are firmly committed to Cedar Fair’s continued growth as an industry leading amusement park operator.”
Jonathan Gasthalter, a spokesman for Apollo, said he could not comment specifically about Kings Island or the agreement.
Sandusky, Ohio-based Cedar Fair owns and operates 11 amusement parks, seven water parks and five hotels. Its properties include Cedar Point in Sandusky, Canada’s Wonderland near Toronto, Dorney Park in Pennsylvania and California’s Knott’s Berry Farm and Great America.
Cedar Fair purchased Kings Island and other CBS Corp. amusement parks in 2006 for $1.24 billion.
In November, Mason City Council postponed action on a proposed 3 percent ticket tax and 5 percent parking tax on local attractions, including Kings Island, until Feb. 8.
City leaders first proposed the tax when Cedar Fair was in the process of buying Kings Island in 2006. City Manager Eric Hansen said there was talk back then of postponing a vote until after the purchase deal was consummated.
Hansen said he doesn’t believe the ticket tax issue would seriously impact the new merger.
“I would imagine it is such a large transaction that this is a relatively minor issue in the big picture,” he said.
Frohle said Apollo is aware of the proposed tax, and she expects them to be just as concerned as Cedar Fair is.
“Obviously they are aware of the situations at our various parks,” she said. “For us it’s business as usual and I would assume they would maintain those same concerns.”
According to a Cedar Fair press release, the merger is conditioned upon, among other things, the approval of holders of two-thirds of Cedar Fair’s outstanding units, the receipt of regulatory approvals and other closing conditions.
The merger agreement does not include a financing condition. Upon completion of the merger, Cedar Fair will become a private company, wholly-owned by an affiliate of Apollo Global Management.
The Associated Press contributed to this story.
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