Asian Journal- The Filipino-American Community Newspaper

SOME of you may have read my article last year advising that Six Flags filed for bankruptcy protection in June, 2009. It listed $2.4 billion of debt which it tried to refinance but was unable to last year. Thus, faced with the certainty of defaulting on its heavy debt burden, and threatened by foreclosures and lawsuits by creditors, Six Flagswas forced to knock on the doors of bankruptcy court to ask for the court’s protection from creditors, and to attempt to reorganize itself into a new entity with a lot less debt.

It was able to successfully reorganize recently by shedding 70% of its $2.4 billion debt, leaving the resultant entity to emerge out of bankruptcy court with only $700 million of debt. $700 million is still a lot of debt but that is a lot less than $2.4 billion! How much money is Six Flags saving with this debt reduction? A lot would be an understatement. First, by a stroke of the bankruptcy judge’s pen, Six Flags got rid of $1.7 billion of debt. That’s how much creditors lost because Six Flags doesn’t have to pay back $1.7 billion of debt anymore. Second, 10% interest on $1.7 billion is $170 million a year or $14.1 million a month that Six Flags no longer has to pay. That’s a whole lot of roller coaster rides. To get $170 million a year to pay interest, Six Flags would need 350,000 more of paying customers yearly. To pay $1.7 billion of principal without any interest, Six Flags would need 3.5 million paying customers! That’s a virtual impossibility unless Six Flags hires candidates for Ms. America to work as staff members parading around the park butt naked. Tiger, Jesse and Bill would buy up all the season tickets. Six Flags would then give the NBA, the NFL and professional soccer a run for their money. It would also steal the thunder from suicide bombers. Instead of killing themselves to go to paradise and get their 72 virgins, they can get season tickets to Six Flags and get a glimpse of paradise without having to blow themselves up. The guy who left the SUV with bombs that failed to explode in Times Square would have just gone to Six Flags to relieve himself and his wife would have just killed him for that. No need to arrest him and waste tax payer money for the trial.

The new entity that emerged from bankruptcy is now called Six Flags Entertainment Corp, and the new stockholders have committed to put in $725 million of capital. The stockholders of the old company, Six Flags INC. have lost everything because shares of the old company are practically worthless. Creditors of the old company who agreed to the reorganization plan are now stockholders of the new company. These creditors are in a lot better shape than the old stockholders. Even if they cannot collect on the old company’s IOU’s, at least they own part of the new company which is poised for profitability because it has 70% less debt than the old company, and it has fresh capital of $725 million coming in. Even with less sales receipts because of the recession that is supposedly gone (Six Flags receipts decreased by 11% last year), Six Flags might start turning a profit this year because of its much reduced debt. Tiger has just told me that he would not buy season tickets for Six Flags even if they hired Ms. America candidates to run around in their birthday suits around the park. He said his sex rehab fees would cause him to file for bankruptcy. I asked him what kind of Freudian mind and sex therapies did he have to undergo in the rehab clinic and if indeed sex rehab clinics did exist. He said look for the unicorns. If you see them, the sex rehab clinics would be right around the corner.

If you need debt relief, contact my office, I will analyze your case personally.

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Lawrence Bautista Yang specializes in bankruptcy, business, real estate and civil litigation and has successfully represented more than five thousand clients in California. Please call Angie, Barbara or Jess at (626) 284-1142 for an appointment at 1000 S. Fremont Ave., Bldg. A-1 Suite 1125 Unit 58, Alhambra, CA 91803.