SeaWorld Entertainment Bids to Acquire Cedar Fair for $3.4B — Report

Theme park and entertainment company SeaWorld Entertainment, Inc. (NYSE: SEAS) has bid to acquire Cedar Fair L.P. (NYSE: FUN) in an all-cash transaction of $3.4 billion, Bloomberg said citing a person familiar with the matter.

The source said SeaWorld has bid to acquire Cedar Fair’s shares for around $60 per share, which represents a 21% premium to FUN stock’s closing price on January 31.

Amusement park operator Cedar Fair said that its Board of Directors will review the bid.

The Ohio-based company rejected a $4 billion takeover offer from Texas-based peer Six Flags Entertainment Corp. (NYSE: SIX) in 2019 and said the bid of $70 per share was too low.

About Cedar Fair

Cedar Fair owns and operates 12 amusement parks, nine included admission outdoor waterparks, four separate admission outdoor water parks, one indoor water park, and 14 hotels/lodging in the U.S. and Canada. It also manages Gilroy Gardens under contract with the Californian city of Gilroy.

About SeaWorld Entertainment

Based out of Florida, SeaWorld owns and operates 12 recreational destinations in the U.S., including seven theme parks and five water parks. Its brand portfolio of theme parks includes SeaWorld, Busch Gardens, Aquatica, Discovery Cove, Sesame Place, Sea Rescue.

Shares of the company gained 2.6% on Tuesday to close at $61.12.

Wall Street’s Take

Michael Swartz of Truist Securities said, “The deal would diversify SeaWorld’s park assets and reduce exposure to the key destination markets of Florida and Southern California, which account for about 65% to 70% of its current attendance base.”

Overall, the stock has a Moderate Buy consensus rating based on 5 Buys and 2 Holds. The average SEAS stock forecast of $73 implies 19.4% upside potential. Shares have gained 101.7% over the past year.

SeaWorld earnings report for the fourth quarter of 2021 is scheduled to be released on March 1, 2022.

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