Cedar Fair, the American park chain, is to be acquired by Apollo Global Management. The transaction is valued at approximately $2.4 billion (€1.7bn), including the refinancing of the company’s outstanding debt (thought to be more than $1.6bn).
“We have considered a wide range of strategic alternatives over the past several years,” reports Cedar Fair chairman, president and CEO Dick Kinzel. “After considering these alternatives, we have concluded that the transaction with Apollo is in the best interest of our unitholders.”
Apollo Global Management, which describes itself as an “alternative asset manager,” is offering unitholders $11.50 in cash for each Cedar Fair limited partnership unit that they hold, a 43% premium. Financing will be provided by affiliates of JP Morgan, Merrill Lynch, Barclays Capital, UBS Investment Bank and KeyBanc Capital Markets.
“Apollo has a strong track record of growing businesses, and its desire to add Cedar Fair to its portfolio serves as a testament to our solid business model and the talent of our people,” observes lead director Michael Kwiatkowski.
The deal is expected to be completed during the second half of 2010 and relies upon approval from the holders of two-thirds of Cedar Fair’s outstanding units, the receipt of regulatory approvals and other closing conditions.
“We look forward to partnering with Cedar Fair’s management team and employees to build on the many strengths of the company,” says Apollo senior partner, Aaron Stone. “We are firmly committed to Cedar Fair’s continued growth as an industry leading amusement park operator.”
Headquartered in Sandusky, Ohio, Cedar Fair LLC owns and operates 11 amusement parks, seven waterparks and five hotels across the United States, including flagship property Cedar Point. The company’s significant debt is understood to be due in part to its acquisition of the former Paramount Parks business in 2006.