TIME WARNER, THE BLACKSTONE GROUP AND WERTHEIM SCHRODER
CLOSE RECAPITALIZATION OF SIX FLAGS
NEW YORK, Dec. 26 /PRNewswire/ -- Time Warner Inc. (NYSE: TWX), The Blackstone Group, and Wertheim Schroder today announced the closing of the recapitalization of the Six Flags Corporation, the second largest theme park operator in the United States. As a result of the transaction, Six Flags will receive an infusion of new equity capital of over $150 million and will retire nearly all of its high-interest debt.
In making the announcement, Robert Pittman, president and chief executive officer of Time Warner Enterprises and CEO of the new parent company of Six Flags said, "Six Flags is a strong, successful operating business that has been hurt by a leveraged capital structure. Our transaction today improves the capital structure and allows us to implement our plans to grow the business. For Time Warner this is a unique opportunity both to extend and support our characters, brands and marketing and merchandising expertise in a situation with enormous upside potential. Regional theme parks, as distinct from 'destination' theme parks are a growing segment of the entertainment industry and should continue to benefit from strong demographic trends and changing vacation habits in the 1990s. Six Flags, with its seven parks located within a day's drive of more than four out of five Americans, is well positioned to take advantage of consumers' desire for a theme park environment that is both exciting and economical for the whole family."
Larry Cochran, president and CEO of Six Flags Corporation said, "The investment of the Time Warner group is a welcome development in the evolution of Six Flags. For a long time, our problem has been our highly leveraged capital structure. This transaction solves the problem and gives us the opportunity to realize our potential. Six Flags now has an owner that is a major force in the entertainment industry who can bring both management strengths and creative assets to the table. We also have the benefit of the business insight and acumen of two sophisticated financial institutions, The Blackstone Group and Wertheim Schroder."
Stephen A. Schwarzman, president and CEO of The Blackstone Group, said, "We are very excited about this transaction. We have been emphasizing partnerships with major corporations in our investment fund and have already set up several such joint ventures. Thus, we particularly look forward to such a partnership in still another industry, and with Time Warner, a major force in the media and entertainment business."
Funds managed by The Blackstone Group and Wertheim Schroder will invest a total of $125 million. Time Warner's investment comes to approximately $50 million, including the original $19.5 million investment made in May 1990.
Six Flags, which was founded 30 years ago in Dallas, Texas, is both the largest U.S. regional theme park company and the second largest theme park company in the world with more than 17 million customers this year and more than 260 million customers in the last 30 years. Six Flags' parks include Six Flags Great Adventure, Jackson, N.J.; Six Flags Great America, Gurnee, Ill.; Six Flags Over MidAmerica, Eureka, Mo.; Six Flags Magic Mountain, Valencia, Calif.; Six Flags Over Georgia, Atlanta, Ga.; Six Flags Over Texas, Arlington, Texas; and Astroworld, Houston, Texas.
In addition to his current role as president and CEO of Time Warner Enterprises, Pittman is chairman and CEO of the new parent company of the theme parks. Cochran will continue to serve as president and CEO of Six Flags Corporation.
Lazard Freres & Co., The Blackstone Group and Wertheim Schroder acted as financial advisors in this transaction.
Time Warner Inc. is the world's leading media and entertainment company with interests in magazines, filmed entertainment, cable television and television programming, recorded music and music publishing, and books.
/CONTACT: Edward Adler of Time Warner, 212-484-6630/
(TWX) CO: Time Warner, Inc.; Six Flags Corporation ST: New York IN: ENT SU: RCN FC -- NY023 -- 5361 12/26/91 16:42 EST