Cedar Point Forum > News >

Cedar Fair's largest shareholder says it will vote against the sale of the company

You must register and login to post.
Previous < Topic > Next

Cedar Fair's largest shareholder says it will vote against the sale of the company

Q Funding III L.P. will vote against acquisition offer.

Posted January 22, 2010, 8:28A by Walt

The largest shareholder of Cedar Fair Entertainment Co. said Friday that it will vote against an acquisition offer from private equity firm Apollo Global Management.

Q Funding III L.P., a Texas investment firm that owns 9.8 percent of Cedar Fair's limited partner units, said "it does not believe it makes sense to vote for the merger and effectively sell at $11.50 when a holder can sell in the market for a higher price."

Read more from the Plain Dealer

News Release from Q Funding III

January 22, 2010, 2:40P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

Interesting that they went and bought a metric s*** ton of shares this week to get a larger stake. Is this a company hoping a better offer comes along, or one who had the means and decided to take a bigger stake to block the sale?

Only %23.5 left to block the sale.


Goodbye MrScott

John

January 22, 2010, 3:13P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

Another way of looking at it is that they need almost 74% of the remaining votes to pass the sale. I don't see how that would even be conceivable. Especially considering a non-vote will be considered a vote against the sale.

At a sale price of $2.4B/$11.5 per share, I'm assuming there are about 208,700,000 shares (give or take)

My 0.000014% vote will be against the sale as well. :-)


819 Coasters, 34 States, 7 Countries
http://www.rollercoasterfreak.com My YouTube

January 22, 2010, 3:18P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

The thing that sucks, is if this does fail (which I hope it does) Apollo will get money for it not passing. Almost makes you wonder if that was the plan all along.

"If the deal falls through, Cedar Fair will have to pay Apollo a “breakup fee” of about $19.5 million. The size of that fee falls to $11.4 million if the agreement falls apart during the go-shop period through Jan. 25, when Cedar Fair can consider other offers."


819 Coasters, 34 States, 7 Countries
http://www.rollercoasterfreak.com My YouTube

January 22, 2010, 3:38P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

The board should be forced to liquidate their own shares to cover that fee.


Goodbye MrScott

John

January 22, 2010, 3:39P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

If this thing is going to be voted down, lets hope Cedar Fair makes the smart move and saves the company $8.1 million by "breaking up" the deal before Monday.

All things considered, they have to know what their chances are of the vote flopping and it would be really disappointing for the $11.4 million to balloon into $19.5 million, because 'hey, there was a decent chance it could've passed'.

January 22, 2010, 3:39P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

...But what shareholder would accept $11.50 for assets that are now worth...$13?

--Dave Althoff, Jr.



/X\ _ *** Respect rides. They do not respect you. ***
/XXX\ /X\ /X\_ _ /X\__ _ _ _____
/XXXXX\ /XXX\ /XXXX\_ /X\ /XXXXX\ /X\ /X\ /XXXXX
_/XXXXXXX\__/XXXXX\/XXXXXXXX\_/XXX\_/XXXXXXX\__/XXX\_/XXX\_/\_/XXXXXX

January 22, 2010, 3:47P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

If they let this thing get to the point where it's going to cost another $8+ million dollars if the vote fails (Monday), and the vote goes on to fail, it's complete BS.

If they're smart enough that they think the vote will still pass, and it does, more power to them. But with the biggest stakeholder voting 'no' it would give me the impression that it's time to pick up the marbles and go home before it costs Millions more.

January 22, 2010, 3:47P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

Jason Hammond said:
Almost makes you wonder if that was the plan all along.

$19.5 million is probably the change Apollo execs find in the cushions in the executive waiting room.

It's the equivalent of a guy who has $100,000 getting $37. Not really worth the effort.

Last edited by Walt, January 22, 2010, 3:49P

Walt Schmidt - Co-Publisher, PointBuzz
PointBuzz on Twitter | Facebook | YouTube
Home to the Biggest Fans of the World's Greatest Amusement Park

January 22, 2010, 3:55P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

Kyle2154 said:
If this thing is going to be voted down, lets hope Cedar Fair makes the smart move and saves the company $8.1 million by "breaking up" the deal before Monday.

I don't think it quite works that way. The only way the deal could be broken up during the "go-shop" phase is if they got a better offer. Not because Cedar Fair finally got out their decoder ring to read the writing on the wall.


Goodbye MrScott

John

January 22, 2010, 3:58P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

And even if Cedar Fair was able to break the deal I doubt they would; because they see nothing wrong with the offer on the table.

Last edited by pointperson, January 22, 2010, 3:58P

Visual Scan!
First Top Thrill Dragster train of 2011!
Rollbacks: 1st Triple Rollback of 2009!

January 22, 2010, 4:21P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

I see what your saying Walt. I just don't see how they thought 66% of the unit holders would have ever been happy with this offer and willing enough to accept this offer. If 19M is pocket change, then what do they even need it for. Let us use it to build another nice B&M somewhere.

Jugga, "decoder ring" really made me laugh. :-)

Last edited by Jason Hammond, January 22, 2010, 4:22P

819 Coasters, 34 States, 7 Countries
http://www.rollercoasterfreak.com My YouTube

January 23, 2010, 12:19A

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

If this deal falls apart would the 2 sides try to come up with another deal? Also would this make Cedar Fair go into bankruptcy if the deal falls apart? I don't know much about stock trading, but I know Cedar Fair needs this to go through someway or another, if they want to keep their parks running smoothly and have something new every year.


Shoot the Rapids is Open! YAY!!
Next CP visit: August TBD
CP Visits: 8

January 23, 2010, 10:48A

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

Another deal? Who knows.

Bankruptcy? No. Apollo approached Cedar Fair. Not the other way around. Cedar Fair was not looking for a buyer.

They might like it to go through. But, they don't need it to go through.


819 Coasters, 34 States, 7 Countries
http://www.rollercoasterfreak.com My YouTube

January 23, 2010, 6:13P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

They need something to happen or they wouldn't have entertained the offer. This comes out of serious concern that they will not be able to meet their loan covenants in the next few years.


Jeff - Advocate of Great Great Tunnels™ - Co-Publisher - PointBuzz - CoasterBuzz - My Blog

January 23, 2010, 7:23P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

Yet, they weren't looking for a buyer. So, they must have had some plans in place or at least in the works.


819 Coasters, 34 States, 7 Countries
http://www.rollercoasterfreak.com My YouTube

January 24, 2010, 1:45A

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

How many total outstanding shares are there? They made the math easy for us. Multiply that number by $1.00 and that's their principal payment on corporate debt each year until it's gone. To take it even further they were considering offering additional units for sale, but decided not to (opting for the dividend cut instead) because at $6-$9 a sale of new units wouldn't bring in that much cash. Those are the two most obvious moves they publicly talked about for managing the debt situation. In the short term, both are bad for the unit holders, but good for the company. The theory behind going for the sale is that selling and taking the company private would be a better deal *for the unit holders* than being forced to do things that reduce the value of those units. As for the company, it doesn't matter...either way the debt gets managed, and either way the money doesn't initially have to come out of the operating budget.

--Dave Althoff, Jr.



/X\ _ *** Respect rides. They do not respect you. ***
/XXX\ /X\ /X\_ _ /X\__ _ _ _____
/XXXXX\ /XXX\ /XXXX\_ /X\ /XXXXX\ /X\ /X\ /XXXXX
_/XXXXXXX\__/XXXXX\/XXXXXXXX\_/XXX\_/XXXXXXX\__/XXX\_/XXX\_/\_/XXXXXX

January 24, 2010, 1:28P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

They certainly were looking for buyers, in a partial sense. They've been trying to unload Great America from the start, and then they put Valleyfair and Worlds of Fun on the market. When no one stepped up to buy those, they certainly were going to entertain an offer for the the entire company if it meant being able to refinance the debt.


Jeff - Advocate of Great Great Tunnels™ - Co-Publisher - PointBuzz - CoasterBuzz - My Blog

January 24, 2010, 2:38P

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

Having actually been to Great America this summer, I have to say..I really can see why they would want to be rid of it. I wonder if the lawsuits surrounding that place are Cedar Fair making the case that to get their precious stadium, the 49ers are gonna have to buy and operate the place. And no, they aren't allowed to shut down the Grizzly. Mitch needs that one to anchor his poll results.

Anyway, reading through the preliminary proxy, it sure sounded like selling properties, or "offering a significant equity stake" in the company were all considered as ways to raise cash without having to eliminate the distribution. In other words, the attitude was that it's okay to dilute the value of the units (since the company doesn't make any money off of them anyway) but not okay to cut the dividend. Ultimately they cut the dividend, and that frees up $1.92 per share (I forgot about the earlier cut) to retire the debt. It's a slow way to go...but assuming 55 million shares outstanding, a 1.6B debt and interest covered through operating revenue, the cost savings on the dividend will pay off the debt principal in 15 years. Before the economy tanked and the credit markets seized up, they clearly had a plan for covering the entire debt through operating revenue alone, so the distribution is probably more about breathing room than anything else.

--Dave Althoff, Jr.



/X\ _ *** Respect rides. They do not respect you. ***
/XXX\ /X\ /X\_ _ /X\__ _ _ _____
/XXXXX\ /XXX\ /XXXX\_ /X\ /XXXXX\ /X\ /X\ /XXXXX
_/XXXXXXX\__/XXXXX\/XXXXXXXX\_/XXX\_/XXXXXXX\__/XXX\_/XXX\_/\_/XXXXXX

January 26, 2010, 9:23A

Re: Cedar Fair's largest shareholder says it will vote against the sale of the company

It didn't make it over here, but a report from CB:

Q has upped their investment to 12%.

Last edited by JuggaLotus, January 27, 2010, 7:39A

Goodbye MrScott

John

Previous < Topic > Next

Cedar Point Forum > News > Cedar Fair's largest shareholder says it will vote against the sale of the company

POP Forums v8
©2008, POP World Media, LLC