Six Flags Bankruptcy Likely To Reduce Value Of Snyder's Shares
Six Flags Saturday declared bankruptcy "after failing to reach a deal with lenders" on $2.4B in debt, and the bankruptcy is "likely to significantly reduce the value of the shares held" by Six Flags Chair and Redskins Owner Daniel Snyder, among others, according to Thomas Heath of the WASHINGTON POST. Six Flags CEO Mark Shapiro in a statement said that the company's theme parks "will remain open and employees will continue to be paid." Shapiro: "This action to clean up the balance sheet paves the way for a full revival of the company." Shapiro added, "When the reorganization is finished, you will see Dan Snyder making a significant investment in Six Flags." Heath noted Snyder owns a roughly 5-6% stake in Six Flags, though he has "seen the value of his shares decline precipitously in recent years." Snyder in a statement said of Shapiro, "Mark and his team have exceeded every operational goal we set out three years ago, and Six Flags is on the path to maintaining its growth and continuing to satisfy millions of guests" (WASHINGTON POST, 6/14). Shapiro said that the company last year "had its best season ever." He added that that, "along with the onset of this year's busy summer season, should leave Six Flags with enough cash to help fund its stay in bankruptcy court." Shapiro said that he "hopes Six Flags will emerge before January" (WALL STREET JOURNAL, 6/15).
TAKING A HIT: The WALL STREET JOURNAL's Spector & McCracken write Six Flags' bankruptcy is a "setback" for Snyder, as it will "likely wipe out" his stake (WALL STREET JOURNAL, 6/15). In N.Y., Michael J. de la Merced noted Six Flags is the "latest company to prove unable to cope with its debt load at a time when previous solutions like refinancing are largely unavailable." The filing is a "blow to Dan Snyder" (N.Y. TIMES, 6/14). In DC, Tim Lemke wrote the filing deals "at least a public relations blow to ... Snyder, who took control of the theme park operator" in December '05. Lemke: "So what does this mean for the Redskins? Not a whole lot, really" (WASHINGTONTIMES.com, 6/14).
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