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Premier grabs Six Flags
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February 9, 1998: 7:00 p.m. ET
Time Warner sells Six Flags to theme park owner in $1.9B great adventure
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NEW YORK (CNNfn) - Premier Parks Inc. agreed Monday to acquire Six Flags Theme Park Co. in a $1.9 billion deal that will give Premier the country's largest franchise on great-adventure-style fun and frolicking.
Under terms of the transaction, Premier -- the owner and operator of 13 regional U.S. theme parks -- will pay Time Warner Entertainment and an investment group $965 million in cash and convertible preferred stock for eight theme parks, three water parks and a wildlife safari park.
Premier will also assume about $890 million in debt.
An investment group led by Boston Ventures currently owns 51 percent of Six Flags equity. The remaining 49 percent of stock is held by Time Warner Inc. (TWX), the parent company of CNN and CNNfn.
The deal also includes a long-term licensing agreement under which Premier will have exclusive theme park rights in the U.S. and Canada to a pantheon of classic cartoon characters ranging from Bugs Bunny and Daffy Duck to Tweety Bird, Yosemite Sam, Batman, Superman and others.
Gerald Levin, Time Warner's chairman and chief executive officer, said the Six Flags sale would help strengthen the company's balance sheet "through the sale of non-core assets."
As of September, 1997, Time Warner had $13.4 billion in long-term debt on its books.
"We have created significant value for our shareholders through our investment in Six Flags, the country's finest regional theme parks," Levin said.
"Now, Time Warner and its shareholders will continue to benefit through our long-term licensing agreement with Premier, under which Warner Bros.' unique and diverse stable of characters and products will reach an audience approaching 40 million people and more each year through both Six Flags and Premier's theme parks."
Premier owns and operates 13 broad-based theme parks in the U.S., with 1997 attendance of around 11 million. In its first venture overseas, the company recently acquired six entertainment parks in Europe, including the six parks of Walibi S.A. in Belgium, the Netherlands and France, which drew 3.5 million people in 1997 on revenues of $70 million.
Its purchase of Six Flags would give Premier combined 1997 revenues of more than $900 million and potential attendance of 40 million.
Last year, more than 22 million thrill-seekers visited Six Flags Entertainment Corp.'s 12 regional parks in major metropolitan areas across the country.
Time Warner is the world's leading media and entertainment company, with diverse interests in filmed entertainment, television production, broadcasting, recorded music and cable television programming, among other fields.
Kieran Burke, Premier's chairman and chief executive officer, called the Six Flags acquisition a "transforming transaction".
"With our single-business focus, proven operating expertise and the combined strengths of the Six Flags and Looney Tunes brands, we believe this transactions gives us an excellent platform for generating superior growth throughout our new and existing franchise," Burke said.
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