People ride a roller coaster at Six Flags Magic Mountain amusement park on its first day of opening as the coronavirus disease (COVID-19) continues to spread in Valencia, California, United States, on April 1, 2021. REUTERS/Lucy Nicholson Get license rights
NEW YORK, Nov 1 (Reuters) – U.S. amusement park operator Cedar Fair LP ( FUN.N ) is exploring a potential merger with Bear Six Flags Entertainment Corp ( SIX.N ), people familiar with the matter said on Wednesday.
A tie-up between the two companies comes as concerns about a US economic slowdown and consumers curbing their discretionary spending weigh on their stock performance. Consolidation will allow us to weather the recession from a strong position.
The companies have discussed a combination in the past, including in 2019, and the latest discussions are not certain to result in a deal, the sources said, requesting anonymity because the matter is confidential.
If there is a deal, it could come as early as Thursday, when Cedar Fair reports quarterly earnings.
Cedar Fair and Six Flags, which have market values 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, in afternoon trading in New York. Neither of them has outperformed the Refinitive United States Leisure & Recreation Price Return Index by more than 15% this year. They struggled to find their footing after the COVID-19 pandemic affected their revenue.
Cedar Fair owns 11 amusement parks and four gated outdoor water parks in 10 US states and Toronto, Ontario. Six Flags is the largest operator of water parks in North America, with 27 parks across the United States, Mexico and Canada.
Reporting by Greg Roumiliotis and David French in New York; Editing by Jonathan Otis
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