NEW YORK - Theme park operator Six Flags Inc., which has been struggling with falling attendance and a large debt load, said yesterday that it would sell seven of its 30 North American parks for $312 million.
Shares of Six Flags closed up 47 cents, or 8.66 percent, at $5.90 on the New York Stock Exchange after the news.
The sale comes after a management shake-up at Six Flags in recent years. Mark Shapiro, a former executive at ESPN, became chief executive officer of the company in December 2005 after a proxy fight led by investor and Washington Redskins owner Daniel Snyder that resulted in the ouster of former CEO Keirian Burke and other executives.
The company said the sale was part of its strategy to reduce debt and enhance its operational and financial flexibility. Six Flags had total long-term debt of $2.1 billion as of Sept. 3, when it filed its most recent quarterly report.
The sale should allow Six Flags to pay down some of its high-interest debt and possibly refinance all of its debt at more favorable terms, according to Friedman Billings Ramsey Group Inc. analyst David Marsh.
Six Flags spokeswoman Wendy Goldberg said the company was not actively looking to sell any more parks.
Combined with the June 2006 sale of land underlying its Houston AstroWorld theme park for $77 million, the sale will result in proceeds of $352 million to be used for debt reduction, according to the company.
The parks are being bought by park operator PARC 7F-Operations Corp. of Jacksonville, Fla., but PARC will simultaneously sell them to Orlando-based real estate investment trust CNL Income Properties Inc. CNL will then lease the parks back to PARC.
The seven parks are Six Flags Darien Lake near Buffalo; Six Flags Elitch Gardens in Denver; Frontier City and the White Water Bay water park, both in Oklahoma City; SplashTown in Houston; Waterworld USA in Concord, Calif.; and Wild Waves and Enchanted Village in Seattle.
Six Flags' three theme parks in Jackson, N.J. - Great Adventure, Hurricane Harbor and Wild Safari - are not part of the sale.
While the Darien Lake and Elitch Gardens sites will no longer carry the Six Flags brand under the new ownership, any 2007 season passes bought at the parks will continue to be honored at all Six Flags-branded parks for the 2007 season.
The deal is expected to close in March, subject to customary closing conditions.