Snyder Sees Six Flags Flying as an Empire Similar to Disney
Friday, August 19, 2005
Redskins owner Daniel Snyder's bid to gain control of a struggling theme park company could be the first step in building a family entertainment empire that tries to emulate the variety and success of enterprises like Walt Disney Co., according to one of the business partners Snyder enlisted in the venture.
In a Wednesday filing with the Securities and Exchange Commission, Snyder outlined practical suggestions about how to drum up more revenue for Six Flags Inc. by selling sponsorships to cell phone companies, signing deals with ice cream vendors, and pursuing other strategies in line with his own background in marketing and advertising. But in subsequent interviews, Snyder and one of his partners, outgoing ESPN television executive Mark Shapiro, suggested that their ambitions extend far beyond roller coasters and bumper cars and into the realm of media moguldom.
"Anything is possible," said Shapiro, who has decided to join Snyder and leave his job as executive vice president for programming at ESPN, a Disney subsidiary. "Dan Snyder is committed to building an entertainment portfolio with a range of assets, and movie studios aren't a total pipe dream."
Snyder's bid to take control of Oklahoma-based Six Flags would amount to a hostile takeover: He owns 11.7 percent of the company, most of which he bought last year, and has offered to start buying millions more shares of company stock to increase his influence. He has asked other shareholders to support him and oust the current management. In place of the existing company leadership, he wants shareholders to appoint him as chairman, make Shapiro the chief executive, and add local home builder Dwight C. Schar, chairman of McLean-based NVR Inc., to the board.
Schar, a minority stakeholder in the Redskins, did not comment on his role in the venture.
Six Flags has said it is reviewing the offer and will advise shareholders later.
The multimedia empire Shapiro and Snyder envision would appeal to all ages, whether through parks, movies or other ventures, Shapiro said. It would include theme parks aimed not just at adrenalin-seeking adolescents but also moms pushing strollers. And, of course, it would offer advertisers myriad ways to hawk their wares to consumers.
Six Flags runs 30 amusement parks, but its revenue and profit have lagged in recent years. The stock, too, has been lagging but has risen more than 18 percent since Snyder announced his plans, closing yesterday at $6.49.
"Thirty-five million people walk through the turnstiles at Six Flags" each year, Shapiro said. "That's a commodity that I think is very attractive to advertisers, brand partners, to movie studios, to athletes, musicians, celebrities and families looking for escape and entertainment."
Several analysts said that despite Snyder's lengthy filing, they found his plans for Six Flags vague. "We have far from enough detail as to how [Snyder] plans to invigorate the parks," said Katherine Styponias of Prudential Equity Group LLC.
James Zoltak, editor of Amusement Business, an industry trade publication, said some of the ideas Snyder and Shapiro have proposed are not new and have been tried by Six Flags management. Snyder suggested that if Six Flags shareholders put his team in charge, for example, the group would consider selling about 3,500 acres of unused or underused property to pay down the company's more than $2 billion in debt. Zoltak noted that Six Flags management has already sold off parks in Europe and North America.
When pressed to offer specific examples of what he would do to turn Six Flags around, Snyder boiled down his prescription to one thing: Shapiro.