The resurgent SeaWorld Entertainment chain saw its stock price jump on Tuesday thanks to a single report that Six Flags may purchase some or all of SeaWorld’s theme parks.
The sole source for the rumor was a Facebook post by blogger Themed Reality, which said “reliable sources” informed him of the acquisition talks. No other news organization has verified the report. Six Flags has not responded to multiple media outlets’ requests for comment and SeaWorld offered no confirmation that the story is accurate.
“We do not comment on speculation or rumors,” said Travis Claytor, SeaWorld’s director of corporate communications.
It wouldn’t be the first time SeaWorld acquisition rumors have fizzled out. In October 2017, Bloomberg reported that Merlin Entertainments, owner of Legoland Florida, had placed a bid for part of the Orlando-based company. A week later, Merlin released a statement saying no such talks had taken place.
It’s also not the first time Six Flags has supposedly been sniffing around SeaWorld. Reuters reported it was one of several companies which could buy the chain in 2013. This was before attendance and revenue plummeted with the release of the 2013 documentary “Blackfish,” which criticized the use and treatment of captive whales in SeaWorld parks.
That downward trend has reversed in 2018, with SeaWorld reporting a nearly 10 percent jump in attendance through the first nine months of the year.
While on the surface, SeaWorld may now seem like a more attractive acquisition, financial experts were quick to throw cold water on the rumor.
“It’s not impossible to buy an appreciating asset, but it takes a lot more money to convince a company’s board and ultimately its shareholders to cash out when the going is good without offering a huge premium,” wrote Rick Munarriz of The Motley Fool.
Munarriz added that Six Flags, already carrying more than than $2 billion, “doesn’t have a lot of financial flexibility to cut a check for the $5 billion or so enterprise value price tag that SeaWorld would command in a buyout at this point.”
The purchase would match Six Flags’ typical strategy of buying or leasing existing parks, such as the five it added to the chain in Houston, Phoenix, Oklahoma City and Buffalo in May.
Despite being the largest amusement park chain in the world in terms of number of properties, Six Flags has avoided entering the Orlando market and competing with the likes of Disney and Universal. When it was rumored in the fall of 2016 that the chain may build a new park on 200 acres of land off International Drive, Six Flags’ then-CEO and president John Duffey was quick to squash any talk of opening a new U.S. park.
“All of the market is covered, so we don’t see anyone really building brand new theme parks in the United States,” Duffey said.