Mergers & Acquisitions Investors Would Love to See: Six Flags (SIX) and Cedar Fair (FUN)
Buyer: Six Flags Entertainment Corp (NYSE:SIX)
Seller: Cedar Fair, L.P. (NYSE:FUN)
In fiscal 2016, Six Flags Entertainment and Cedar Fair had combined revenues of $2.6 billion and net profits of $258 million. Walt Disney Co’s (NYSE:DIS) parks and resorts business had revenue of $17 billion and operating profits of $3.3 billion.
Disney might have some problems at the moment, but this isn’t one of them. It makes more in amusement park profits than Six Flags, and Cedar Fair generate in combined revenue.
Together, the merged company can go on an acquisition binge to bulk up further, allowing it to better compete against Mickey and Minnie. It’s not a new idea, mind you. Back in 2010, the two companies were rumored to be a potential tie-up.
I don’t think much has changed in the seven years since. Bigger, in this case, is probably better.