Wild Ride: Kirkland, Weil Gotshal, and Squire Patton Boggs advise on Cedar Fair/Six Flag Merger

As amusement parks have struggled with growth following the pandemic, Six Flags and Cedar Fair have delighted markets with their announcement that the two amusement park giants will join in a $8 billion deal. The merger of equals is expected to close in the first half of 2024 and result in Six Flags shareholders owning 48.8% of the combined company and Cedar Fair unitholders owning 51.2%. 

“The combined company will operate a portfolio of 27 amusement parks, 15 water parks and 9 resort properties across 17 states in the U.S., Canada, and Mexico,” according to the companies’ joint press release. “The combined company will also have entertainment partnerships and a portfolio of beloved IP such as Looney Tunes, DC Comics, and PEANUTS to develop engaging new attractions enabled by compelling characters, environments, and storytelling.”

Cedar Fair attracted multiple suitors in recently years – but has played hard to get. In fact, the two companies have courted before, with Six Flags making an offer to acquire Cedar Fair in 2019, which was rejected by the latter. As recently as 2022, Cedar Fair rejected an offer from SeaWorld. 

The combined companies will create an amusement park giant – albeit one still dwarfed by the Disney dreadnought. Even with 27 amusement parks, 15 water parks and 9 resorts across the U.S., Canada, and Mexico, Cedar Fair/Six Flags will also trail Universal Studios’ domestic operations but lead virtually all other competitors. 

The companies estimate a cost savings of $120 million within two years of closing. Such savings is a critical boost to profitability as parks have struggled to increase attendance. Analysts point to high prices, increasing competition, travelers’ waning budgets, hot summer weather, and even Florida politics as factors dampening attendance. 

According to James Hardiman at Citi, “Whereas the theme park industry as a whole has been under significant pressure since the start of the pandemic, Six Flags has created additional pressure of its own, with a volatile new attendance and pricing strategy that has struggled to take root, alienating its core customers and leading to dramatic drops in visitation along the way.” 

Attendance at Disney theme parks in the U.S. 2019-2022; by park (in millions)

According to Matterhorn’s comprehensive M&A database, which harnesses AI to track current and historical deals, Cedar Fair is advised by law firms Weil, Gotshal & Manges LLP and Squire Patton Boggs LLP, and financial advisor Perella Weinberg Partners LP, while Six Flags is advised by Kirkland & Ellis LLP and financial adviser Goldman Sachs & Co. LLC.