People ride the roller coaster at Six Flags Magic Mountain theme park on the first day of opening, as the coronavirus disease (COVID-19) continues, in Valencia, California, U.S., April 1, 2021. REUTERS/Lucy Nicholson Obtaining licensing rights
NEW YORK (Reuters) – U.S. theme park operator Cedar Fair LP (FUN.N) is exploring a potential merger with peer Six Flags Entertainment Corp (SIX.N), people familiar with the matter said on Wednesday.
The tie-up between the two companies will come at a time when concerns about the US economic slowdown and consumers restricting their discretionary spending have weighed on the performance of their stocks. A merger would allow them to weather the slowdown from a stronger position.
The sources, who requested anonymity because the matter is confidential, said the two companies have discussed a merger in the past, including in 2019, and there is no certainty that the latest deliberations will lead to an agreement.
If there is an agreement, it could happen as early as Thursday, when Cedar Fair reports its quarterly earnings.
Cedar Fair and Six Flags, which have market caps of $1.8 billion and $1.7 billion, respectively, did not immediately respond to requests for comment.
Shares of Cedar Fair and Six Flags rose more than 6% and 7%, respectively, on the news in afternoon trading in New York. Each has underperformed the Refinitiv United States Leisure & Recreation Price Reward Index by more than 15% this year. They struggled to find their footing after the Covid-19 pandemic impacted their revenues.
Cedar Fair owns 11 theme parks and four gated outdoor water parks in 10 U.S. states and in Toronto, Ontario. Six Flags is the largest water park operator in North America, with 27 parks across the United States, Mexico and Canada.
(Reporting by Greg Roumeliotis and David French in New York – Prepared by Muhammad for the Arabic Bulletin) Edited by Jonathan Oatis
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