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Cedar Fair Amusement Parks

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Publicly traded limited partnership Cedar Fair (FUN) will acquire the Paramount Parks business of CBS Corp (CBS) for approximately $1.25 billion. The five parks involved in the deal are located near Cincinnati (OH), Richmond (VA), Charlotte (NC), Santa Clara (CA), and Toronto.



Cedar Fair already operates seven amusement parks and five water parks, including the company's flagship Cedar Point property on Lake Erie. The company intends to keep all five properties. The deal will be financed by a $2 billion loan from Bear Stearns (BSC). The interest rate charged will be determined once Cedar Fair's debt has been rated.

The acquisition is quite large relative to the size of Cedar Fair's existing business. Cedar Fair generated $569 million in revenues during 2005. During the same time period, the Paramount Parks properties generated $423 million in revenues.

In addition to the five parks, Cedar Fair will receive Star Trek: The Experience (at the Las Vegas Hilton) and the Nickelodeon license at the five Paramount Parks.

The Paramount Parks properties encompass about 1,250 owned acres and 180 leased acres. Based on past attendance, the five acquired properties will likely be some of the most visited parks in the new Cedar Fair portfolio. However, none of the new properties is likely to eclipse Cedar Fair's two most visited properties: Cedar Point and Knott's Berry Farm.

By far the two largest parks being acquired are Canada's Wonderland (located near Toronto) and Kings Island (located near Cincinnati).

Cedar Fair's chairman Dick Kinzel said:

"This acquisition will provide exciting new growth opportunities and the potential for meaningful incremental free cash flow as we realize $20-$30 million in annual cash flow synergies over the next 3-5 years. It will also add significant geographic diversity to our portfolio of parks and improve our position as one of the largest regional amusement park operators in the world."

The acquisition will require significant debt financing. However, the amusement park business generally has a very high free cash flow margin. Cedar Fair's existing properties are excellent generators of free cash flow. The company makes large cash distributions to unitholders; the current yield is somewhere around 6.85% (reminder: Cedar Fair is a Limited Partnership). Returns on both assets and equity have generally been quite high.

The deal is expected to close in the third quarter of 2006. Most analysts believe CBS will use the roughly $1 billion in after-tax proceeds to buy back shares.

Over the last ten years, Cedar Fair has compounded its book value per share at an annual rate of 8.11% and earnings per share at an annual rate of 6.30%.
Cedar Fair Amusement Parks
Parents, you know there is always an increased stress when it comes to the safety and security of your family during an outing. Can't stand the anxiety? Not sure where to start? Take a few minutes with a family safety plan by following some of these easy steps so it's not just the kids having all the fun?you can too!

Before going to the event, tell your child...

... to have fun while paying attention to where they are and who they are with at all times.

...they should not be alone in the park or become isolated with anyone, even characters in costume. Tell them not to accept any prizes, offers, or gifts from anyone until they have checked with you FIRST.

...they should be cautioned not to engage in conversation with or offer assistance to anyone until they have checked with you.

...to tell you if anyone approaches them or makes them feel uncomfortable. Tell you children if they are approached by anyone who tries to take them to yell ?This person is not my father (mother)!? and do whatever they need to do (kick, punch, scratch,) to get away from that person.

...if you become separated in the park to go to the closest ?Help/Information Center? to ask the people there to ?find my parents and bring them to me here at this Center? or, in the case of older children, make the ?Help/Information Center? the spot where you can ?meet up?. Make sure your child understands they should never search for you on their own or look for you outside the park, especially in the parking lot.

...these rules also apply when they are taking part in a field trip through their school or youth group. If you are not joining them for the trip, they need to check first with and tell the responsible adult in charge or a designated chaperone if anything is wrong.

As a parent you should...

...get all the information about the park prior to you trip, and review the park guidelines, particularly those regarding lost children. Discuss the information with your family, including what to do if you become separated. As your children what they would do in certain situations, and practice appropriate actions and responses with your children.

...get a map immediately arriving, identify the ?Help/Information Centers? throughout the park and reinforce the idea these are the places for children to go to in case you become separated in the park. Making a plan before hand, in case you are separated, should greatly speed up the reunion.

...talk to your child about who can help them if they become lost, need help, or are in trouble. Examples: park personnel with nametags or uniforms or mothers with strollers and children.

...never let your child use public bathrooms or changing facilities alone.

...not put your child's name prominently displayed on clothing, backpacks, or jewelry.

...make sure your child has emergency contact numbers with them if they ever need assistance including your cell phone numbers.

...dress your child in or asking them to wear brightly colored clothes so you can easily spot them in the park.

...accompany young children on rides in the park. Older children should stay in groups and take a friend with them wherever they go in the park. If you decide to let young children go on rides without you, wait with them in line, watch them enter the ride, and immediately meet them when they exit the ride.

...immediately report any suspicious or inappropriate behavior to authorities.

...make certain your child has change to use the telephone. If you have a cell phone or pager, make certain your children know those numbers and how to activate them on the phone. Parents might want to invest in two way radios so family members can keep in contact with each other.

...immediately report your child missing if you become separated. Be prepared to give an accurate and detailed description of your child. You should carry a recent photograph and be able to accurately describe the clothing the your child is wearing

...make certain there is going to be qualified supervision of the children by responsible adults when granting permission for your child to go on a field trip.

By taking the time to share with your family a safety plan for your next trip to a fair, festival or amusement park fun can be had by all, without the worry of a family member missing or lost.
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About Author
Both Geoff Gannon & Michelle Annese are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Geoff Gannon has sinced written about articles on various topics from Computers and The Internet, Home Management and Finances. Geoff Gannon writes a daily value investing blog and produces a twice weekly (half hour) value investing podcast at:. Geoff Gannon's top article generates over 4400 views. to your Favourites.

Michelle Annese has sinced written about articles on various topics from Stock, Family Concerns and Beauty Tips. Michelle Annese, ?The Diva of Defense?? is a self defense instructor, consultant, speaker, author, and copywriter. With a third degree black belt and inductee into the World Martial Arts Hall of Fame, Ms. Annese is a safety advocate teaching thousands eac. Michelle Annese's top article generates over 14800 views. to your Favourites.
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