According to SEC filings, Snyder and his Red Zone hedge fund have poured some $50 million into his purchase of amusement-park operator Six Flags. Two years ago, when Snyder began building his stake in the company, it traded near $12 a share. In mid-November, after the company missed Wall Street expectations, the stock dropped to $1.91 and has mostly stayed there.
Securities lawyers say that a share price that low creates a perilous situation for Snyder. MarketWatch, among other business media, speculated that the company is “distressed” and listed it among those that may have to file for bankruptcy in 2008.
Should the stock price drop below $1, the stock exchange might be compelled by rule to delist it—which would affect its credit agreements and might send its other investors, such as Bill Gates’s Cascade Investment, running for the exits.
If Six Flags doesn’t begin to recover on its own, Snyder would have to support the stock aggressively. A reverse stock split is one possibility. Or Snyder and his allies, including McLean-based homebuilder Dwight Schar, a Six Flags director, may have to buy all the shares held by the public and take the company private, say attorneys familiar with Snyder’s situation.
Says one lawyer, “He can’t tolerate the price of Six Flags stock being this low for very long. Don’t expect to see the Redskins spending a lot of money.”
Some investors are wondering if the kind of change that turned around the Redskins season—the injury to quarterback Jason Campbell that allowed Todd Collins to shine—might revive the theme-park operator. But the Redskins owner has given no indication that Mark Shapiro, who as CEO gets some of the blame for Six Flags’ problems, would be the latest Snyder employee to get axed.
This article can be found in the February 2008 issue of The Washingtonian.
Snyder’s Six Flags Sinking Fast
Redskins owner Dan Snyder had a little better year on the football field than as a businessman.
According to SEC filings, Snyder and his Red Zone hedge fund have poured some $50 million into his purchase of amusement-park operator Six Flags. Two years ago, when Snyder began building his stake in the company, it traded near $12 a share. In mid-November, after the company missed Wall Street expectations, the stock dropped to $1.91 and has mostly stayed there.
Securities lawyers say that a share price that low creates a perilous situation for Snyder. MarketWatch, among other business media, speculated that the company is “distressed” and listed it among those that may have to file for bankruptcy in 2008.
Should the stock price drop below $1, the stock exchange might be compelled by rule to delist it—which would affect its credit agreements and might send its other investors, such as Bill Gates’s Cascade Investment, running for the exits.
If Six Flags doesn’t begin to recover on its own, Snyder would have to support the stock aggressively. A reverse stock split is one possibility. Or Snyder and his allies, including McLean-based homebuilder Dwight Schar, a Six Flags director, may have to buy all the shares held by the public and take the company private, say attorneys familiar with Snyder’s situation.
Says one lawyer, “He can’t tolerate the price of Six Flags stock being this low for very long. Don’t expect to see the Redskins spending a lot of money.”
Some investors are wondering if the kind of change that turned around the Redskins season—the injury to quarterback Jason Campbell that allowed Todd Collins to shine—might revive the theme-park operator. But the Redskins owner has given no indication that Mark Shapiro, who as CEO gets some of the blame for Six Flags’ problems, would be the latest Snyder employee to get axed.
This article can be found in the February 2008 issue of The Washingtonian.
Most Popular in News & Politics
Sandwich Guy Has Become DC’s Hero
How Washingtonians Can Run, March, and Rally Against the Trump Administration Takeover
Pirro’s Office Fails to Get Indictment Against Sandwich Guy
DC’s Police Union Head Is the Biggest Cheerleader of Trump’s DC Police Takeover
Health Officials Flee CDC After White House Fires Director, Tensions Between Parents and ICE Erupt in Mount Pleasant, and There’s a New Red Panda
Washingtonian Magazine
September Issue: Style Setters
View IssueSubscribe
Follow Us on Social
Follow Us on Social
Related
These Confusing Bands Aren’t Actually From DC
Fiona Apple Wrote a Song About This Maryland Court-Watching Effort
The Confusing Dispute Over the Future of the Anacostia Playhouse
Protecting Our Drinking Water Keeps Him Up at Night
More from News & Politics
Why Trump Should Not Dine Out in DC
DC Sues Trump Administration Over Deployment of National Guard Troops
In Wild Coincidence, White House Drowns Out Epstein Rally With Jets; Tech Titans Will Gather on Rose Garden Patio Tonight; and Madison Cawthorn Hopes to Return to DC
The “MAGA Former Dancer” Named to a Top Job at the Kennedy Center Inherits a Troubled Program
Epstein Survivors Will Rally in DC Today, Trump Denies That He Has Died, and Someone Is Dotting Capitol Hill Trees With Bananas
We’re Calling It Now: Sandwich Guy Is the DC Halloween Costume of the Year
No Phones Allowed at This New DC Bar. Seriously.
Trump Defies Internet Sleuths by Posting Furiously About Hulk Hogan and Other Stuff, Rudy Giuliani to Receive Nation’s Highest Civilian Honor, and Chester the Toucan Got Rescued in Arlington