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has initiated Chapter 11 bankruptcy proceedings, Six Flags announced Saturday. Six Flags’ (OTCBB: SIXF) board of directorsz on June 12 voted to beginj reorganization proceedingsin U.S. Bankruptcy Court for the Districgof Delaware. The company listed assetd of $3.03 billion and debts of $2.37 billion in its filing. New York-baseed Six Flags is planning to reorganizethe company’ financial structure, which management said is feeling the pressur e of an inherited $2.4 billion debt.
In a letter to employees, Six Flags CEO and president Mark Shapirio saidthe company’s debt is left over from previous management and despitw the company making $275 million last it has been difficult for Six Flags to improv e its balance sheet when paying out $175 million in interest on debt, Shapiro asserted. He addefd that more than $400 million in debt is due within the next 12 and the company is havin tospend $100 millionm in park improvements in an atmosphere wher refinancing is difficult. Shapiro assured employees no staff reductionse will arise out of the and employees will continue to be paid andreceivr benefits.
Shapiro said the bankruptcy plan has the support ofthe company’s lendera and the agent administering the company’sw $1.1 billion senior secured credit Six Flags parks, including Six Flage Great America, will continue to operats as usual under reorganization. Six Flagsx sold several properties last year toraisde capital. It still operates 20 amusement parks inNorty America.
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