Cedar Fair/Six Flags gets $3.1 billion debt commitment for merger

By Sara Rosenberg

New York, Nov. 2 – Cedar Fair/Six Flags has received a commitment for a $2.3 billion 364-day term loan and $800 million of revolving credit commitments to help support the merger of Cedar Fair LP and Six Flags Entertainment Corp., according to an 8-K filed with the Securities and Exchange Commission on Thursday.

Goldman Sachs Bank US provided the debt commitment.

The companies expect to refinance their revolving credit facilities, and Six Flags expects to refinance its term loan ahead of the merger close.

The transaction is not expected to trigger any change-of-control provision under Cedar Fair’s and Six Flags’ respective outstanding notes, minimizing refinancing needs for both companies.

Cedar Fair said in a presentation that it plans to complete the revolver commitment and Cedar Fair bonds consent solicitation, then focus on pre-merger integration preparation and the Six Flags shareholder vote, then refinance the Six Flags term loan, and then close on the transaction.

Under the merger agreement, Cedar Fair unitholders will receive one share of common stock in the new combined company for each unit owned, and Six Flags shareholders will receive 0.58 shares of common stock in the new combined company for each share owned.

Following the close of the transaction, Cedar Fair unitholders will own about 51.2% and Six Flags shareholders will own around 48.8% of the combined company’s fully diluted share capital on a pro forma basis.

Closing is expected in the first half of 2024, following receipt of Six Flags shareholder approval, regulatory approvals, and satisfaction of customary conditions.

The combined company is expected to have a pro forma leverage ratio of around 3.7x net debt to adjusted EBITDA, inclusive of synergies, with a path to reduce the leverage ratio to about 3x within two years of close.

Sandusky, Ohio-based Cedar Fair and Arlington, Tex.-based Six Flags are amusement park operators. Upon closing, the combined company will operate under the name Six Flags and be based in Charlotte, N.C.

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