SeaWorld Entertainment (SEAS) is up ~5% after Blackstone (BX) sold its 21% equity interest in the company to Zhonghong Zhuoye Group at $23.00 per share, a 33% premium.
It is an impressive exit for Blackstone, who will no longer hold any interest in SeaWorld. The private equity firm brought SEAS public in 2013.
SeaWorld has struggled to entice visitors to its theme parks after the Blackfish documentary in 2013 changed at least some people's perception of keeping animals captive for entertainment purposes. What's more, competition from Disney (DIS) and Universal Studios (CMCSA) is stiff in its core markets of Florida and Southern California.
Attendance fell 2% last year after rising 0.3% in 2015 and falling 4.2% in 2014.
Zhonghong Group is a diversified holding company focused on strategic growth opportunities in the leisure, tourism, and culture industries.
SeaWorld and Zhonghong also agreed to advisory services and support agreements under which SeaWorld will advise Zhonghong Holding exclusively on the concept development and design of theme parks, water parks, and family entertainment centers to be developed and operated by Zhonghong Holding, including exclusive rights in China, Taiwan, Hong Kong and Macau. So this deal does open up a new avenue of growth for the company.
SeaWorld punted on fiscal 2017 guidance when it reported fourth quarter results in late February. The company plans to issue EBITDA guidance for the full year when it reports Q1 results, likely in early May. The Street expects EBITDA to rebound to 2015 levels after falling about 8% last year.
SeaWorld has a ~$1.6 billion market cap and roughly the same amount of debt.