News Enchanted Parks & EPR Acquire Seven Parks from Six Flags

[paintervision]

I was talking with a former student who used to work at SF (pre-merger) about everything going on and he mentioned something that was interesting that I felt with my past. Smaller parks can be darn as a “minimal investment” location because these parks might not always bring in the most money, but you can set the clock by them so to speak.

Consistent revenue is good but it’s not the only thing that matters. It seems like Six Flags isn’t looking to scale down parks that may have got too big or expensive to maintain under previous management*, like SFA for example. Selling parks is better than closing them down entirely, but I suspect SF realizes that removing a few signature coasters and trying to go small would send the wrong signals, and make it much more difficult to operate a park that way.

* (For a positive example of this, Kentucky Kingdom and Wild Adventures may be the best ones I can think of. They seemed to pivot away from previous owners into leaner parks. Not sure Six Flags wants to invest this way with smaller parks, but an example may be Great Adventure on their end, but that park has a lot more untapped potential.)

 

[DH_The_ThemeParkFaniac]

I knew what you meant by a petition to stop the sale. I was asking what eminent disaster you see under EnParks ownership that stopping the sale would prevent. SFEC never heavily invested in this park, period. Aside from Bobcat, the every adult coaster addition was a relocation from another park except for the Boomerang. In non-coaster additions, they added a handful of flats over the 30 years they had the park, half of which were also relocations. 31 years of ownership, and they added two coasters and four adult flat rides that they didn't already own. Legacy-Six did not contribute substantial investment to this park, and did not give any indication that such would be changing, so the worst you should expect is status quo.

If you want to bring up history, why do you think that SFEC is the better company to carry on the legacy of Charles Wood, who ran the park for the first 41 years of its life? The park has not always been owned by Six Flags, you know. Or, more accurately, why do you think that EnParks will "destroy the park and ruin Charles Wood's legacy"? Specifically, what makes you think they will do a worse job of it than SFEC?

Geauga Lake/SFO was sold to Cedar Fair, not an independent operator, who closed it partially because it was too close geographically to Cedar Point. SFGE is hours away from the next nearest amusement park in any chain, let alone one under the new EnParks banner. There is no reason to be concerned about the park closing in the near future under EnParks. If anything, the chances of the park closing in the next few years just dropped to near zero, whereas if it had remained under SFEC ownership, there's a very good chance it would have been SFA'd at any time. SFEC was looking to cut their portfolio and reduce the amount of parks they had. This is an indisputable fact. If they didn't sell it to EnParks, or some other owner, it would have likely been closed. That is the cold, hard, and maybe sad, truth.

And yeah, I hate generative AI as much as the next person, but you know that SFEC is using it too, right? Logos, merchandise, advertising....everywhere. It would have come to your park anyway. The "they use AI" argument is a net neutral.

I understand that you only know things that you've personally experienced, but you need to look at the entire circumstances of something to be able to form an educated opinion. Otherwise you just come off as a little kid crying about the fact that the sun went away at night.

PS - You don't need to double-post, you can edit your previous responses.

Alright, sorry for the panic. Maybe I should look forward for GE’s future then?

 

[warfelg]

Consistent revenue is good but it’s not the only thing that matters. It seems like Six Flags isn’t looking to scale down parks that may have got too big or expensive to maintain under previous management*, like SFA for example. Selling parks is better than closing them down entirely, but I suspect SF realizes that removing a few signature coasters and trying to go small would send the wrong signals, and make it much more difficult to operate a park that way.

* (For a positive example of this, Kentucky Kingdom and Wild Adventures may be the best ones I can think of. They seemed to pivot away from previous owners into leaner parks. Not sure Six Flags wants to invest this way with smaller parks, but an example may be Great Adventure on their end, but that park has a lot more untapped potential.)

I got to be honest here, a little confused by this retort because I don’t see how your statement of better sell small parks than scale down parks has much to do with small parks don’t get the same amount of investment because the bring in the same end result.

SF selling parks makes sense right now because they have enough debt that they need the one time influx of cash to pay down debts to improve bigger parks. What I was pointing out was the constant flow of income from a park you don’t need to invest much in is good when you have long term strength position because you know you will get a certain amount from that park every year.

 

[Zachary]

What I was pointing out was the constant flow of income from a park you don’t need to invest much in is good when you have long term strength position because you know you will get a certain amount from that park every year.

I'm not saying you're wrong—I think both legacy Cedar Fair and legacy Six Flags believed this.

I do think there has been a fundamental shift in this rational within the company though. I, too, think that the primary reason for seeking to offload so many parks is to try to get debt load under control, but this EPR/Enchanted deal sorta illustrates precisely that other factors are potentially just as important for new Six Flags. Per Six Flags, "On an after-tax basis, net proceeds are expected to be slightly beneficial to the Company’s leverage ratio." "Slightly" tells me that this isn't really going to do much for the company, even just in the short-term, financially. If there's only marginal benefit to the leverage ratio but Six Flags pursued the deal anyway, I think that tells us there has to be other factors at play here.

I've long thought that the economies of scale theory in this business has been massively overstated and that Six Flags' theory of the merger—that enormous cost synergies would be found that would allow for substantial cost optimization—was bogus. I think this new sale certainly proves that. We haven't seen much in the way of cost consolidation in the chain beyond the firing of park-level management so, if there were other efficiencies to be found (more substantial and preferably with fewer negative side effects), I strongly doubt they've already been successfully implemented. If those efficiencies existed, they should make these small, "set it and forget it" properties notably more valuable to the combined chain than they were in either pre-merger corporation and especially more valuable to even smaller operators (like Enchanted). Since that's clearly not the case, I think we have to conclude that synergistic cost reductions either cost more to implement at smaller parks than they're worth or that they were just enormously overstated from the start.

I also think it's probably reasonable to take Six Flags at face value in regards to their claim of wanting to narrow the chain's portfolio in pursuit of increased managerial focus. I doubt this would have been true pre-merger, but post-merger, given that on-site park management across the chain has been largely decimated, I can see where dedicating corporate man-hours to the management and oversight of these smaller properties is just a strictly bad investment for the chain.

So yeah, I don't think anyone disagrees that you're correct re: the thinking of the legacy chains, but I do think something has majorly shifted.

 

[warfelg]

I'm not saying you're wrong—I think both legacy Cedar Fair and legacy Six Flags believed this.

I do think there has been a fundamental shift in this rational within the company though. I, too, think that the primary reason for seeking to offload so many parks is to try to get debt load under control, but this EPR/Enchanted deal sorta illustrates precisely that other factors are potentially just as important for new Six Flags. Per Six Flags, "On an after-tax basis, net proceeds are expected to be slightly beneficial to the Company’s leverage ratio." "Slightly" tells me that this isn't really going to do much for the company, even just in the short-term, financially. If there's only marginal benefit to the leverage ratio but Six Flags pursued the deal anyway, I think that tells us there has to be other factors at play here.

I've long thought that the economies of scale theory in this business has been massively overstated and that Six Flags' theory of the merger—that enormous cost synergies would be found that would allow for substantial cost optimization—was bogus. I think this new sale certainly proves that. We haven't seen much in the way of cost consolidation in the chain beyond the firing of park-level management so, if there were other efficiencies to be found (more substantial and preferably with fewer negative side effects), I strongly doubt they had yet to be implemented. If those efficiencies existed, they should make these small, "set it and forget it" properties notably more valuable to the combined chain than they were in either pre-merger corporation and especially more valuable to even smaller operators (like Enchanted). Since that's clearly not the case, I think we have to conclude that synergistic cost reductions either cost more to implement at smaller parks than they're worth or that they were just enormously overstated from the start.

I also think it's probably reasonable to take Six Flags at face value in regards to their claim of wanting to narrow the chain's portfolio in pursuit of increased managerial focus. I doubt this would have been true pre-merger, but post-merger, given that on-site park management across the chain has been largely decimated, I can see where dedicating corporate man-hours to the management and oversight of these smaller properties is just a strictly bad investment for the chain.

So yeah, I don't think anyone disagrees that you're correct re: the thinking of the legacy chains, but I do think something has majorly shifted.

The reason I’m confused because I responding to @AmyUD06 discussing the lack of investment in the smaller parks - because they see it making about the same amount no matter what they did.

The response to my post pulled a small part and discussed something I wasn’t addressing.

 

[paintervision]

Per Six Flags, "On an after-tax basis, net proceeds are expected to be slightly beneficial to the Company’s leverage ratio." "Slightly" tells me that this isn't really going to do much for the company, even just in the short-term, financially. If there's only marginal benefit to the leverage ratio but Six Flags pursued the deal anyway, I think that tells us there has to be other factors at play here.

Yeah, I mean revenue is only a small piece of the puzzle, and does not tell the whole story.

Sorry @warfelg but I got off on a tangent, but I think there are other aspects of these parks that we are just not seeing. Costs are not fixed season to season, weather continues to be a pain point, and some hard choices for older rides are going to need to be made. SF is busy trying to grow their super-regional parks, and that is where the focus is now.

 

[AmyUD06]

Alright, sorry for the panic. Maybe I should look forward for GE’s future then?

You absolutely should. EnParks has given us no reason to doubt their stated plans or abilities. If the first thing they do to GE is tear out half the coasters or demolish the awesome whimsical storybook land section, then I'll be right there with you.

 

[GASM]

and some hard choices for older rides are going to need to be made.

This is the key factor I’m looking at with all of the parks sold. Not one of them is in a good position in this aspect, of the 47 coasters they operate only 14 have opened in the past 25 years (and not been relocations), 4 being at WoF alone. Not only are tough decisions for older rides going to be coming up much sooner, those older rides make up most of the parks’ lineups.

For reference, Magic Mountain alone has added 10 brand new coasters in that same timeframe. It’s a much more popular park than any of these 6, sure, but the point is that it would be much more well equipped to handle a mass exodus of aging attractions.

 

[DH_The_ThemeParkFaniac]

Idk if I should say it but Travis Kelce is gonna get pissed when he finds out about those 7 parks being bought

 

[portablegirl]

Idk if I should say it but Travis Kelce is gonna get pissed when he finds out about those 7 parks being bought

given that he has a stake in the company he likely already knew about the parks being sold off well before the general public.

 

[Zachary]

given that he has a stake in the company he likely already knew about the parks being sold off well before the general public.

There's zero reason to think this. Not sure it would even be legal for the company to disclose the information to select shareholders like that?

 

[portablegirl]

There's zero reason to think this. Not sure it would even be legal for the company to disclose the information to select shareholders like that?

fair point tbh. i'll admit, i barely know much of anything about how these sorts of things work. just came to this conclusion considering how big of a stake he and his partners have in the company itself.

 

[AmyUD06]

fair point tbh. i'll admit, i barely know much of anything about how these sorts of things work. just came to this conclusion considering how big of a stake he and his partners have in the company itself.

Nine percent amongst the entire investment group, of which Kelce is only one member. Nine.

 

[DH_The_ThemeParkFaniac]

They said their new logos would pop up in a couple of weeks according to this post
https://www.reddit.com/r/sixflagsstlouis/s/GDKF7YO0y1

Let’s pray to god it’s not all AI Slop

 

[northdetective]

The way I found out Enchanted Parks bought Diggerland USA was reading second hand that the CEO referred to it as a "destination park"

 

[MaxxForceFan]

Here is a link to the interview Coaster101 did with James Harhi.

The Coaster101 Podcast: 1 on 1 with Enchanted Parks CEO James Harhi - Coaster101

It sounds like they want to build out more Diggerland USA locations and now they have a bunch of parks in the midwest with extra land available.

 

[GASM]

The way I found out Enchanted Parks bought Diggerland USA was reading second hand that the CEO referred to it as a "destination park"

I grew up less than 15 miles from where Diggerland ended up opening, and still lived there for 7 more years after it opened. It was so poorly advertised that I had no idea where the hell it was (or even WHAT it was) until I took a wrong turn on my way to a job interview and ended up in the parking lot.

The interviewer never even showed up, but at least I now knew where and what Diggerland was, I guess.

 

[Zachary]

I honestly think there may be something to the whole "Diggerland is a destination park" thing.

I was chatting with my neighbor a month or two ago and Diggerland came up completely organically. She has two young boys who are going through a big truck phase and they apparently learned about Diggerland on YouTube. She told me that they are actively looking to take a weekend trip to Diggerland (from VA).

Her boys were super into Sesame a year or two ago and she knew about Sesame Place (and I assume Sesame at BGW), but as far as I know they never considered or went to either to meet Elmo. Apparently they do intend to travel for Diggerland though. Thought that was pretty fascinating. It's sorta an IP park without any of the licensing headaches and costs. Hell, you can actually implement big money sponsorships as theming. Not many opportunities like that in the industry I don't think.

If you told me that in 10 years there would be a handful of Diggerlands across the country and it's on track to become a household brand name, I don't think I'd be that surprised honestly. They look dirt cheap to build, dirt cheap to run, command a hefty price, and there's no third party rights holders to pay. Seems like a sure-fire financial success to me as long as kids keep liking heavy machinery.

 

[northdetective]

The Youth Yearns For Tactile Experiences. We Must Directly Exalt the Infrastructures of Fun and the Fun of Interacting With Infrastructures

 

[DH_The_ThemeParkFaniac]

I don’t get why they wouldn’t just call The Great Escape just “The Great Eacape”

Not “Great Escape by Enchanted Parks”