Six Flags said today that it has filed for Chapter 11 bankruptcy protection. The bankruptcy of the world’s largest regional theme park company is not exactly surprising, given the company’s huge leverage, debt payment coming due in August and recessionary pressure on discretionary spending cutting into ridership on the 800 rides it operates in 20 parks.
If anything, it might be slightly surprising that no one in the government tried to bail out the company.
Unlike the contentious bankruptcies of Chrysler and General Motors, Six Flags has the unanimous support of its lenders’ steering committee. The bankruptcy plan would reduce the companies debt by about $1.8 billion, and eliminate $300 million in preferred stock obligations.
“The current management team inherited a $2.4 billion debt load that cannot be sustained, particularly in these challenging financial markets,” the chief executive of Six Flags said in a news release. “As a result, we are cleaning up the past and positioning the company for future growth.”
Don’t worry, kids: the park operations in the US, Canada and Mexico will continue uninterupted.