A little over a year after officials from Six Flags Inc. rebuffed his attempt to become a member of the company's board, Redskins owner Daniel Snyder yesterday won the right to join them after an independent firm certified that owners of more than 57 percent of the company's shares backed his appointment.
Snyder's victory also secured board seats for local home builder Dwight C. Schar and former ESPN executive Mark Shapiro and represents a step toward a potentially larger move into the entertainment industry.
With Six Flags shareholders looking for stability, the newly constituted board is likely to meet soon, corporate governance experts said. When it does, the major issue will be whether to keep the company's chairman and chief executive, Kieran E. Burke, or appoint Shapiro as chief executive and make Snyder chairman of the board.
As part of his attempt to gain control, Snyder took the unusual step of recruiting Shapiro from his job at ESPN and nominating him to become the company's top executive -- essentially selling shareholders on the idea that he and Shapiro could reverse Six Flags' lackluster performance.
Though shareholders have voted to remove Burke and two others from the board to make room for Snyder and his nominees, only the board can replace the chief executive and pick a new chairman.
Snyder's victory secured him only three seats on the company's seven-member board, but he believes the shareholder support gives him a mandate to make the changes he desires.
"The shareholders have spoken -- and we would like to thank all of them for this vote of confidence," Snyder said yesterday in a news release.
The three ousted Six Flags officials did not comment. The company issued a short news release confirming the result of the shareholders' vote.
The decision over the chief executive's job will be an important test of how the two board factions get along following a sharp public fight.
Snyder and board member Michael E. Gellert, for example, exchanged pointed letters over the past year. In an Oct. 7, 2004, letter to Gellert, Snyder dismissed the current management as "investment bankers based in New York" out of touch with the company's operations.
Gellert responded by saying Snyder's ideas for turning around the theme park company, such as outsourcing food service and overhauling marketing, were "not insightful" and "demonstrated a lack of understanding about the theme park business."
There have been cases of corporate board members cooperating after bitter proxy battles, said Charles M. Elson of the University of Delaware's Weinberg Center for Corporate Governance. Just because harsh words were exchanged doesn't mean people took them personally.
"Proxy fights are by nature heated and unpleasant," he said.
Elson cited Blockbuster Inc. as a recent example of a board absorbing a group of dissident shareholders. This year, billionaire Carl C. Icahn won a bruising proxy battle to secure three seats on the board of the Dallas video-rental company. He kept the peace, however, by voting to keep John Antioco as chairman and chief executive -- a less likely option in this case because Snyder has built his proposal around making Shapiro head of the company.
Shapiro joined Snyder just as the Redskins owner was preparing to pitch his plan for Six Flags to the handful of investors who control most of the company's stock.
Six Flags officials had countered Snyder's criticism by saying that the entire theme park industry suffered following the terrorist attacks of Sept. 11, 2001, and that an increase in revenue and attendance this year proved their own turnaround strategy was working. Betting the company's future on Snyder and Shapiro, who had no theme park experience, they contended, was "risky."
The board also put the company up for sale, arguing that shareholders would get a better deal through an auction than they would from Snyder, who they said was trying to gain effective control over the company without paying for it. The sale process continues, and initial bids are due by early December.
But the prospect of a buyer wasn't enough to make shareholders wait. They voted without seeing any bids, indicating that many shared Snyder's view that Six Flags' management hadn't done enough to revive the company, whose shares dropped from a high of $40 in 1999 to a low of $3.36 in 2004.
Snyder did not reveal yesterday which shareholders had supported him. Spokesmen for Fidelity Investments, Franklin Advisors and Dimensional Fund Advisors, three of the company's largest investors, said they do not comment on specific securities. Omaha fund manager Wallace Weitz, who controls 10.6 percent of Six Flags shares, had no comment. Representatives for Microsoft Corp. Chairman Bill Gates, who owns an 11.5 percent stake, did not return calls.
Dwight C. Schar, left, and Mark Shapiro, center, will become directors at Six Flags Inc., where Kieran E. Burke is the current chairman.