Cedar Fair Announces Conditional Full Redemption of All Outstanding 5.500% Notes Due May 2025

Rhea-AI Summary

Cedar Fair, L.P. (FUN) announced a conditional full redemption of its 5.500% Senior Secured Notes due 2025, totaling $1.0 billion, on May 2, 2024, contingent upon a financing of at least $1.0 billion. The Redemption is subject to various conditions, with no guarantees of fulfillment. This press release provides details on the Redemption process but does not serve as an official notice.

Insights

Financial Analyst

The announcement by Cedar Fair of a conditional full redemption of its senior secured notes is a strategic financial move that indicates the company's focus on optimizing its capital structure. By redeeming these notes, the company is potentially looking to reduce its interest expenses and extend the maturity profile of its debt, which could improve financial flexibility. This action may be viewed positively by investors as it often signals a company's strong liquidity position and a proactive approach to managing liabilities.

However, investors should be aware that the redemption is contingent upon the completion of a financing event that provides sufficient proceeds. This introduces an element of uncertainty, as there is no guarantee that Cedar Fair will secure this financing on favorable terms, or at all. If the company does proceed with the redemption, it will be essential to evaluate the terms of the new financing to assess its impact on the company's cost of capital and overall debt burden.

Market Research Analyst

In the context of the regional amusement and entertainment industry, Cedar Fair's decision to redeem its 2025 Secured Notes may reflect broader trends towards restructuring debt amidst a potentially changing interest rate environment. The company's ability to secure new financing with at least $1.0 billion in gross proceeds will likely depend on market conditions and investor confidence in the sector's post-pandemic recovery.

It's important to monitor the industry's performance indicators such as visitor numbers and spending patterns, as they could influence the company's revenue streams and, consequently, its ability to service new debt. Additionally, the move to redeem these notes could be a strategic effort to align the company's capital structure with its long-term growth and investment plans, which could have implications for its competitive positioning and market share.

Legal Expert

From a legal standpoint, the redemption of debt instruments like the 2025 Secured Notes is governed by the terms set forth in the indenture. Cedar Fair's notice specifies that the redemption is conditional, which is not uncommon, but it does require close examination of the indenture to understand the implications for note holders. The company's ability to waive conditions at its discretion adds another layer of complexity.

Note holders should review the terms of the redemption, including any applicable redemption premium or interest payments. Furthermore, the legal framework surrounding the issuance of new debt to finance the redemption will be critical in determining the rights and protections for both existing and potential new investors. The impact on the company's legal obligations and covenants should also be considered, as these could affect the company's operational flexibility and strategic decisions going forward.

SANDUSKY, Ohio--(BUSINESS WIRE)-- Cedar Fair, L.P. (NYSE: FUN) (the “Company”), a leader in regional amusement parks, water parks, and immersive entertainment, together with its wholly owned subsidiaries as co-issuers (together with the Company, the “Co-Issuers”), today announced that it has delivered a notice of conditional full redemption (the “Notice”) to holders of its 5.500% Senior Secured Notes due 2025 (the “2025 Secured Notes”). The Notice calls for the redemption of all of the outstanding $1.0 billion aggregate principal amount of the 2025 Secured Notes (the "Redemption") on May 2, 2024. The Redemption is conditioned upon, among other requirements, the consummation of a financing resulting in aggregate gross proceeds to the Company of at least $1.0 billion. There can be no assurances as to when and if such conditions will be satisfied and the Company may waive the conditions at its discretion.

This press release does not constitute a notice of redemption of the 2025 Secured Notes. Information concerning the terms and conditions of the Redemption is described in the Notice distributed to holders of the 2025 Secured Notes by the trustee under the indenture governing the 2025 Secured Notes.

This press release is for informational purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation, or sale in any jurisdiction in which such offering, solicitation or sale would be unlawful.

About Cedar Fair

Cedar Fair Entertainment Company (NYSE: FUN), one of the largest regional amusement-resort operators in the world, is a publicly traded partnership headquartered in Sandusky, Ohio. Focused on its mission to make people happy by providing fun, immersive, and memorable experiences, the Company owns and operates 13 properties, consisting of 11 amusement parks, four separately gated outdoor water parks, and resort accommodations totaling more than 2,300 rooms and more than 600 luxury RV sites. Cedar Fair’s parks are located in Ohio, California, North Carolina, South Carolina, Virginia, Pennsylvania, Minnesota, Missouri, Michigan, Texas and Toronto, Ontario.

Forward-Looking Statements

Some of the statements contained in this news release that are not historical in nature constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements as to the Company’s expectations, beliefs, goals, strategies regarding the future and the satisfaction of any conditions relating to the Redemption. These estimates, projections, and other forward-looking statements may involve risks and uncertainties that are difficult to predict, may be beyond our control and could cause actual results to differ materially from those described in such statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Important factors, including general economic conditions, the impacts of public health concerns, adverse weather conditions, competition for consumer leisure time and spending, unanticipated construction delays, changes in the Company’s capital investment plans and projects and other factors discussed from time to time by the Company in its reports filed with the Securities and Exchange Commission (the “SEC”) could affect attendance at the Company’s parks and the Company’s growth strategies, and cause actual results to differ materially from the Company’s expectations or otherwise to fluctuate or decrease. Additional information on risk factors that may affect the business and financial results of the Company can be found in the Company’s Annual Report on Form 10-K and in the filings of the Company made from time to time with the SEC. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether a result of new information, future events, information, circumstances or otherwise that arise after the publication of this document.

This news release and prior releases are available under the News tab at https://ir.cedarfair.com

View source version on businesswire.com: https://www.businesswire.com/news/home/20240410882251/en/

Investor Contact: Michael Russell, 419.627.2233

Media Contact: Gary Rhodes, 704.249.6119

Alternate Media Contact: Andrew Siegel / Lucas Pers, Joele Frank, 212.355.4449

Source: Cedar Fair, L.P.

FAQ

What is Cedar Fair, L.P.'s ticker symbol?

The ticker symbol for Cedar Fair, L.P. is FUN.

When is the full redemption of the 2025 Secured Notes scheduled?

The full redemption of the 2025 Secured Notes is set for May 2, 2024.

What is the total principal amount of the 2025 Secured Notes being redeemed?

Cedar Fair, L.P. is redeeming the entire $1.0 billion aggregate principal amount of the 2025 Secured Notes.

What is the condition for the Redemption to take place?

The Redemption is contingent upon a financing that results in the Company obtaining at least $1.0 billion in gross proceeds.

Is there a guarantee that the Redemption conditions will be met?

There are no assurances regarding the fulfillment of the Redemption conditions, and the Company may choose to waive them at its discretion.