Bankruptcy

Theme Parks Suffering With Economy? Six Flags May Be Filing Chapter 11 Bankruptcy And Ghost Town Already Has

By Scott Riddle

Six Flags Theme Parks, which includes Six Flags Over Georgia, Six Flags White Water, and American Adventures parks in the Atlanta area, is experience significant financial difficulties and there is speculation that a Chapter 11 Bankruptcy filing might be in its future.

From the Associated Press:

Shares of Six Flags Inc. fell in premarket trading Friday as worries grew that the theme park operator may have to file for Chapter 11 bankruptcy protection.  Six Flags shares lost 2 cents, or 10.5 percent, to 17 cents in early trading. The stock has traded between 16 cents and $2.50 during the past 52 weeks.  In its fourth-quarter earnings report on Tuesday, Six Flags said it does not expect to have enough cash to redeem its preferred income redeemable shares on their redemption date of Aug. 15...

The shares, known as PIERS, must be redeemed for $287.5 million plus accrued and unpaid dividends, which may total up to $31.3 million. The company has skipped paying the dividends since May of last year... In its annual report filed with the Securities and Exchange Commission on Wednesday, the company said it may be forced to file for Chapter 11 bankruptcy if it cannot negotiate an out-of-court restructuring agreement with its PIERS holders, common stockholder and creditors.  "Such a court filing would likely occur prior to the maturity of the PIERS or well in advance of such date, if we were to conclude at such time that an out-of-court solution is not feasible or advantageous," Six Flags said in the filing.

Meanwhile, another theme park has already filed a Chapter 11 petition.  From Andy Peters' Deal Watch Blog, Ghost Town in the Sky in Maggie Valley, N.C., filed a Chapter 11 petition in the Western District of North Carolina.  Ghost Town and nearby Frontierland were frequent destinations for those of us who grew up in western North Carolina in the 1970's.  There was even Ghost Town: The Movie. You can see a video of Ghost Town by clicking here.

Full post as published by Georgia Bankruptcy Blog on March 14, 2009 (boomark / email).