The speculation was fun while it lasted. Just hours after the New York Post ran a story detailing a $4.1 billion buyout bid of Cedar Fair
"We are not currently in discussions with that organization or any other party for the sale of the company," CEO Dick Kinzel noted in yesterday afternoon's announcement.
It's about time, Cedar Fair. There's nothing wrong with having a corporate policy not to comment on takeover speculation, but the company's silence since the first New York Post story on the buyout chatter three weeks ago had been deafening.
The timing for a buyout had seemed suspect. Cedar Fair was already trading at a higher EBITDA multiple than were recent industry acquisitions. It also seemed too soon to hand over the keys just two operating seasons into the company's gargantuan acquisition of CBS's
However, by waiting so long to publicly tear down the story, the company appeared to be silently opening up the bidding process. It may very well have, though yesterday's announcement is pretty stern. Either the company never got an appropriate buyout bid, or it was never on the block at all.
It's not a good time for this industry, once you look past theme park giant Disney
In short, this isn't the best time to open up a bidding war. Once the turnstiles begin turning in the right direction, Cedar Fair can punch out in style.
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Longtime Fool contributor Rick Munarriz enjoys taking his family to amusement parks as often as possible. He owns shares in Disney and units in Cedar Fair. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool's disclosure policy calls dibs on the zebra.
