Cedar Fair agreed to be purchased by Apollo Global on Dec. 16, but since the announcement, major investors have loudly protested the $11.50 per unit price and vowed to stop the deal. Other investors filed lawsuits, also hoping to stop the $2.4 billion purchase.
As a result of the termination, Cedar Fair will pay Apollo $6.5 million to reimburse expenses the company incurred in connection with the transaction, a release reads.
Dick Kinzel, chairman, president and chief executive officer of Cedar Fair said the company will heed the apparent wishes of its investors.
“The board has heard from Cedar Fair unitholders and it is apparent that the merger transaction does not have the required level of investor support,” Kinzel said. “We are honored and excited by the opportunity to continue to manage and operate Cedar Fair as a public company and to provide our guests with an outstanding experience.”
The shareholders were scheduled to vote on the merger on Thursday. The first merger vote was scheduled for March 16, but subsequently canceled.
Attorney Jack Landskroner, who represents the first investor to file a lawsuit to stop the sale, said Cedar Fair did the right thing.
“I think the shareholders have spoken loud and clear,” he said. “They believe Cedar Fair was undervalued in this deal and that they will not accept their interest and the interest of the company being put behind the interests of insiders.”
Cedar Fair stock ended trading at $12.44 on April 6, after the failed sale was announced.
The initial agreement also included Apollo Global absorbing Cedar Fair’s $1.54 billion in debt. Kinzel said some parks have already opened across the country and things are looking promising.
“We hope to continue this momentum across the rest of our properties and throughout the operating season,” he said. “As we execute on our business objectives, we will also be evaluating next steps to address our capital structure. The board and management team remain committed to acting in the best interests of all Cedar Fair unitholders. We appreciate the feedback that we have received from unitholders as well as Apollo’s interest in Cedar Fair and their cooperation and professionalism throughout the process.”
Cedar Fair spokeswoman Stacy Frole said $640 million worth of term debt matures in 2012 and the remaining $900 million comes due in 2014. She said their financial team believes the markets are opening up and they are in the process of negotiating with the banks.
Frole said Kings Island visitors will not notice any difference when the park opens on April 17.
“There should be no impact to our operations and our customers should still experience a great time,” she said. “We are focused on our cornerstones of service, cleanliness, safety, courtesy and integrity.”
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