Link? I don't know why Merlin wouldn't be interested in a deal since they initiated all the talk surrounding a buyout in the first place.
Rumor Restructuring? Sale? Interest from Merlin Entertainments
- Thread starter Shane
- Start date
Could be that they are, but this news is an incomplete picture of what's going on.Shane said:
There was quite a bit of discussion here about whether Merlin would want SEAS, BGW/BGT, Sesame, all or combination of pieces...
So hypothetically, if I were Merlin and wanted parts, approached SEAS and floated the idea, and they said sure, if you take it all...but that's not what I want and I'm in a stronger negotiating position...there isn't anything to "negotiate" from Merlin's perspective until SEAS changes their mind, and maybe I say I'm not that interested afterall.
If there's any truth to that, both the interest and the press release are accurate, but within context...
And thus I'd expect that Kabuki to play out for awhile until SEAS decides:
a) they could get deal done with Parques Reunidos or someone else for everything--and if Parques Reunidos, does that bode well for Madrid?
b) they determine they can return greater value to shareholders by dividing assets up and selling parts (to Merlin or whomever)
c) an acceptable deal isn't currently possible so they'll go it alone for now
thopping said:a) they could get deal done with Parques Reunidos or someone else for everything--and if Parques Reunidos, does that bode well for Madrid?
God no. Parques Reunidos sucks! It would be awful if they bought the SeaWorld Chain. They don't own any major theme parks in the USA so, to me, their ability to operate one doesn't seem promising, especially since they can barely take care of the upkeep at Lake Compounce where Boulder Dash is running like crap and they crashed the trains during a coaster event a couple months ago in August. And during the Golden Ticket Awards it was the only coaster (out of the three they have) that they had up and running for an industry event. But the worst thing about them being owners is that they rarely invest in their current parks.
I, personally, would not welcome Universal's management at SEAS. Their modus operandi seems to be to build beautiful, expertly-themed parks, with abominable operations.
For anyone interested in learning more about Parques Reunidos here is a list of the more famous parks they operate:
Along with several others worldwide. Some other parks you may have heard of that they own are Idlewild and Dutch Wonderland where S&S's first family inverted coaster, Merlin's Mayhem, has been under construction for over a year. The majority of their U.S. parks are located in Pennsylvania and New England.
Something I found kind of interesting is that their "flagship park" in Madrid, Parque de Atracciones de Madrid, is a relatively small park and mostly unmentioned park of only 49 acres.
The company also owns several Zoos, Aquariums, and Marine Life Parks around the world including SeaLife Park - Hawaii, Marineland - France, and several others along with an extensive portfolio of waterparks that includes the famous Noah's Ark in Wisconsin Dells and Wet'n Wild Emerald Point in North Carolina (which was at one point the second WaterCountry USA before BEC bought the chain and sold the park, but that's another story for another thread).
***On a personal note, Wet'n Wild Emerald Point is the only park I have ever been to that they own and while I did go on a week day right after school had started back in August last year, the park was clean and well maintained.
- Mirabilandia - Italy
- Movie Park Germany
- Warner Bros Park - Madrid
- Kennywood - Pennsylvania
- Lake Compounce - Connecticut
Along with several others worldwide. Some other parks you may have heard of that they own are Idlewild and Dutch Wonderland where S&S's first family inverted coaster, Merlin's Mayhem, has been under construction for over a year. The majority of their U.S. parks are located in Pennsylvania and New England.
Something I found kind of interesting is that their "flagship park" in Madrid, Parque de Atracciones de Madrid, is a relatively small park and mostly unmentioned park of only 49 acres.
The company also owns several Zoos, Aquariums, and Marine Life Parks around the world including SeaLife Park - Hawaii, Marineland - France, and several others along with an extensive portfolio of waterparks that includes the famous Noah's Ark in Wisconsin Dells and Wet'n Wild Emerald Point in North Carolina (which was at one point the second WaterCountry USA before BEC bought the chain and sold the park, but that's another story for another thread).
***On a personal note, Wet'n Wild Emerald Point is the only park I have ever been to that they own and while I did go on a week day right after school had started back in August last year, the park was clean and well maintained.
I think you could make a case that they might be able to do a good job with SEAS parks. Kennywood is charming and well-maintained. Idlewild is quirky, and seems to be working on upkeep. The fact that they already have animal parks indicates that they understand that business, as well.
Nicole said:
Kennywood is well-maintained because it is a national and historic landmark. There are standards that have to be kept to preserve it so they have to constantly maintain it.
Something I forgot to mention before, Parques Reunidos' subsidiary in the U.S. is Palace Entertainment.
I dare say that Lake Compounce would fall into the same category as Kennywood as a national and historic landmark since it is the oldest continuously operating amusement park in the United States and sounds like it does not meet the standards required for a landmark.
It could very well come down to each of the local park management teams and Palace Entertainment has a more hands-off corporate approach.
As Parques Reunidos' has made acquisitions over the years, those parks have been rolled into Palace Entertainment. If they were to acquire SeaWorld Parks and Entertainment, do you think that they would continue to operate SEAS as as an additional U.S. subsidiary or would they roll the SEAS parks into Palace Entertainment?
I dare say that Lake Compounce would fall into the same category as Kennywood as a national and historic landmark since it is the oldest continuously operating amusement park in the United States and sounds like it does not meet the standards required for a landmark.
It could very well come down to each of the local park management teams and Palace Entertainment has a more hands-off corporate approach.
As Parques Reunidos' has made acquisitions over the years, those parks have been rolled into Palace Entertainment. If they were to acquire SeaWorld Parks and Entertainment, do you think that they would continue to operate SEAS as as an additional U.S. subsidiary or would they roll the SEAS parks into Palace Entertainment?
I honestly think a company would have to be inept to roll the SeaWorld parks (lower case "parks"—the three actual SeaWorld locations and their affiliated water and marine life parks) into their existing, stable brand. There is zero question that "SeaWorld" is a very tarnished brand-name.
It seems more likely that a buyer would want to integrate the Busch parks, their water parks, and Sesame Place into their existing brand and keep the SeaWorld Parks brand in place to as a subsidiary unbrella for the parks that are more, well, high-risk branding-wise.
It seems more likely that a buyer would want to integrate the Busch parks, their water parks, and Sesame Place into their existing brand and keep the SeaWorld Parks brand in place to as a subsidiary unbrella for the parks that are more, well, high-risk branding-wise.
I hesitated to bring this thought forward in my last post, but given your commentary above Zach, I wonder if it would be wise for Palace to roll their other Marine parks into SeaWorld and roll the Busch parks into Palace and pretend they're not all owned by Reunidos. The average American doesn't pay much attention to who owns who with things like subsidiaries.
I think someone else mentioned the possibility of Reunidos buying the whole chain then selling the two Busch parks to Merlin, but that doesn't make a whole lot of sense to me. Why would you want just the damaged brands and ditch your only good brands to a competitor?
I think someone else mentioned the possibility of Reunidos buying the whole chain then selling the two Busch parks to Merlin, but that doesn't make a whole lot of sense to me. Why would you want just the damaged brands and ditch your only good brands to a competitor?
Could be a good business move...
It depends on what the SeaWorld parks are worth to them and how motivated SEAS is to do a deal.
Side-note: I haven't followed the SeaWorld controversy at all. Really. I don't know what it is other than its name & have never bothered to google it. Yes, must've been under a rock on this. So I have no idea whether it is short-term brand damage or something that clouds the park's whole model going-forward. I'm assuming the former though, thinking whatever the fallout is...SeaWorld is still a strong brand I think, especially when compared to Reunidos' marine properties in the US.
So if this is the case and Reunidos/Palace wants SeaWorld in their portfolio and is at best neutral on Busch/Sesame... Buy SEAS, add the SeaWorld Parks to your portfolio, and fund the transaction in part by flipping the other properties to Merlin or someone you think wants them.
SEAS' property mix could complicate an outright deal somewhat... of course these two rumored suitors either have a similar type mix with Reunidos or a mix of theme parks and wax museums of all things with Merlin, plus people here say Merlin wouldn't want the wildlife element in their parks. But SEAS' mix may explain fewer rumors about Six Flags, Cedar Fair, etc. at least that I've seen here.
Point is, I'm not ruling out a multi-party deal or successive deals. A SEAS transaction could also provide motivation for Reunidos/Merlin to reorganize around core competencies, spin off assets, and add focus to their respective brand identities.
Caveat--I don't claim to know what would make the most sense to the business strategies of any of these companies--just noting there are several possibilities beyond an acquisition of SEAS as a long-term strategy to add all of its properties to their portfolios. I also don't own SEAS stock and have to plans to acquire SEAS in the next 60 days.
It depends on what the SeaWorld parks are worth to them and how motivated SEAS is to do a deal.
Side-note: I haven't followed the SeaWorld controversy at all. Really. I don't know what it is other than its name & have never bothered to google it. Yes, must've been under a rock on this. So I have no idea whether it is short-term brand damage or something that clouds the park's whole model going-forward. I'm assuming the former though, thinking whatever the fallout is...SeaWorld is still a strong brand I think, especially when compared to Reunidos' marine properties in the US.
So if this is the case and Reunidos/Palace wants SeaWorld in their portfolio and is at best neutral on Busch/Sesame... Buy SEAS, add the SeaWorld Parks to your portfolio, and fund the transaction in part by flipping the other properties to Merlin or someone you think wants them.
SEAS' property mix could complicate an outright deal somewhat... of course these two rumored suitors either have a similar type mix with Reunidos or a mix of theme parks and wax museums of all things with Merlin, plus people here say Merlin wouldn't want the wildlife element in their parks. But SEAS' mix may explain fewer rumors about Six Flags, Cedar Fair, etc. at least that I've seen here.
Point is, I'm not ruling out a multi-party deal or successive deals. A SEAS transaction could also provide motivation for Reunidos/Merlin to reorganize around core competencies, spin off assets, and add focus to their respective brand identities.
Caveat--I don't claim to know what would make the most sense to the business strategies of any of these companies--just noting there are several possibilities beyond an acquisition of SEAS as a long-term strategy to add all of its properties to their portfolios. I also don't own SEAS stock and have to plans to acquire SEAS in the next 60 days.
This long-running controversy is the reason SeaWorld's brand is injured, perhaps irrecoverably.
I'm not sure whether it will recover, or whether social norms have moved to the point that animal shows and zoos are in some way doomed in the long run. What I believe we are seeing, however, is an attempt to distance Sesame Place and the Busch parks from the tarnished SeaWorld name.
I'm not sure whether it will recover, or whether social norms have moved to the point that animal shows and zoos are in some way doomed in the long run. What I believe we are seeing, however, is an attempt to distance Sesame Place and the Busch parks from the tarnished SeaWorld name.
thopping said:
SeaWorld has been dealing with this since their IPO in 2013 with the Blackfish Documentary that aired on CNN. The Documentary was much older and really started causing problems well before this (and BlackStone really should have seen it coming before putting the company's IPO out there) but it wasn't until CNN decided to air the documentary that it became a problem. And to save you the time of reading through a thread of 5 years worth of information, most people here agree that the majority of the documentary is fake, fluffed, PETA propaganda, but you can make that decision for yourself.
thopping said:
Both Merlin and Reunidos own Zoos and Aquariums, so it is not a problem to have wildlife in their parks. The issue is that Merlin has a strict no Marine Mammal performance rule for their parks. A rule that they've even recently admitted as why they aren't interested in the SeaWorld Parks.
I can certainly see where SeaWorld wants to sell themselves whole and not in two pieces but sometimes breaking up a company can unlock a lot more value than staying whole. That being said I wonder how much money is playing a part in this because as it stands now the company has a Market Cap of $1.13B (per THE STREET but this figure can fluctuate wildly per the stock price) but the company currently has total assets of $2.17B but total liabilities of $1.93B that includes $1.51B of long term debt (thank you Blackstone) per their last quarterly report. This makes you wonder if SEAS is trying to get a price at or above their listed assets to maximize shareholder return even though their Market Cap is $1B less. With this difference I don't know if potential buyers will bite unless the price is closer to the cap figure which would mean a loss to SEAS or whether someone will pay a premium just to get what they want, which SEAS will obviously try for. But yet some analysts have put an estimate purchase price of just the two BG, and the associated water parks, in the range of $750M to $1B. Just throwing this out there.
This is really the issue I have with companies like SeaWorld, SixFlags, and Cedar Fair being publicly traded (and honestly a large portion of any publicly traded companies). Leadership often makes shareholder gains their top priory over the long-term health of the company.
Shane said:
True, but that is indeed the point to the publicly-traded company: to deliver shareholder value. That may mean long-term health of the company and translation into stock value growth or dividends, or, like Alf33 (and I, though not as detailed as Alf33's analysis) was pointing out, it may make sense to split up the assets to unlock the their growth potential, or possibly get a better valuation on those assets if they were in-turn bought by another company. SEAS may find that the sum of the parts exceeds the whole, especially if the Busch brands really are tarnished by SeaWorld, or if another company's interest is based on forecasted operational efficiencies that maybe assume only certain types of properties are acquired.
Thanks as well for the background & link on the controversy. That's probably why I never bothered to look into it, getting a sense of how Shane described what most people's assessment has been. Perhaps some facts, but facts chosen to fit a narrative, and thus it's hard without independent research to validate what the true story is. And I simply haven't had the time or priority to do that, especially since one must really do that with every piece of news from any source...as the news sells stories, stories with facts that fit a narrative, and generate revenue by catering to consumers that agree with that narrative. They too are are publicly-traded companies looking to return shareholder value...
Nichole's observation is actually why I'm not sure how much brand damage there really is--i.e. is it part of a larger societal view, or limited to an incident that's assumingly isolated. I don't know... I do know that most people (admittedly, not extensive or scientific survey) that have mentioned SeaWorld to me have lamented a perceived focus shift away from marine life to a theme park...and not once blacklisted them due to a documentary.
thopping said:
I think this is part of a major issue that isn't talked about enough when it comes to the health of the SeaWorld-branded parks. Public opinion on SeaWorld is split—and there are plenty of people on boths sides of that split that are willing to skip SeaWorld next time they make a trip to Universal or Disney.
Many people won't get near a SeaWorld park because they think SeaWorld trainers beat orcas until they jump through flaming hoops and over spike-filled barges and then reward them by shoving them into a 10 gallon fish tank behind the stadium with a trash compactor.
Many other people read the news that SeaWorld is ending orca and dolphin shows and think "Ok, so why on earth would I visit SeaWorld...? It's a park with a bunch of stadiums where I can learn about majestic animals I'd not know existed if it weren't for SeaWorld. That's what made SeaWorld worth visiting!"
Tragically, SeaWorld is stuck in the middle. Because cultural trends say that animal performances are quickly moving out of style, they have to respond to public pressure and follow that trend (preferably, be ahead of it, in fact). That said, changing the entire direction of a very high-profile brand like SeaWorld is like trying to redirect an oil tanker with a cue stick as you try to kayak alongside it. Oh, also, because the kayak has passed through a few hands over the last couple years and no one has taken care of it particularly well, it has some leaks—so you're trying to bail out the water while trying to redirect your oil tanker of a brand.
It's a really bad situation all around. SeaWorld Orlando could have a future as the budget-friendly, "themed amusement park," option people can add onto their Florida vacations, but that requires a ton more attraction investment—which requires money the chain doesn't have. To catch that niche, SeaWorld would have to find a way to fund a bunch of new attractions AND lower prices. That seems impossible. Alternatively, the park could pick up a bunch of valuable IP... But that requires a ton of capital for rights AND the attractions to use said IPs. That doesn't seem doable right now either.
And that is just for SeaWorld Orlando, probably the least at-risk of the SeaWorld parks right now. Poor SeaWorld San Diego...
Zachary said:
Well, I think you nailed it. SeaWorld's real problem is that it is niche. Putting aside the animal issues for a minute, where you do have one camp that wants to confer human rights to animals and another that sees places like SeaWorld as providing valuable education and exposure to animals, that had they not existed for the past many decades, would have made it much harder to raise awareness about animal issues in the first place--as for most people they would be "out of sight, out of mind." (i.e. Ironically, we may not be having such a debate had SeaWorld, zoos, etc. not existed).
The thing that always struck me about SeaWorld, once they started adding major attractions like multi-million dollar B&M coasters, is that's a hard balance to pull off.
The demographic that appreciates Kraken may not be the same that wants to see a dolphin show. I personally found SeaWorld to be a good family mix, but there are probably many that veer towards one type of attraction versus another. You also don't see many aquaria or zoos that try to pull that off, Columbus Zoo and some few excepted.
Versus trying, and perhaps failing, to compete with the myriad of theme parks or change to more of a passive aquarium, SeaWorld should try to embrace their niche and offer something truly unique. (Which I think is actually their strategy). Whether that market it big enough to be economically sound... I don't know. (I do think if they could transform to a budget-friendly theme park...they're toast. Their success lies in being unique, not commodity).
Caveat: this whole post is really biased towards SeaWorld Orlando, which is the only one I've been to, and I agree, would have the biggest chance of success to carve out a differentiated piece of a very large vacation market. I'm not really familiar with poor San Diego or the others...
PS: There's reason to hope they can pull it off though, at least in Orlando... Arguably parks like Animal Kingdom and Epcot also try to have a dual focus and differentiate themselves from straight theme parks. Granted, Epcot's challenges are well documented...but they're not entirely due to trying to balance within that niche. I personally think Epcot is one of the best conceived parks ever; I just wish the Mouse would invest in it more. (which is also why I like BGW's hamlets so much and cringe at anything that further dilutes their small amount of authenticity)