We couldn’t be happier!
The bankrupt company’s creditors are asking the courts to hold up proceedings until they can investigate the relationship between Six Flags and Red Zone LLC, an investment group Snyder formed with a lot of Redskins Park, including team bigwigs Vincent “Vinny” Cerrato and Karl Swanson. Snyder used the group’s Six Flags stock holdings take over the amusement park chain via a stockholder coup in 2005. Snyder anointed Mark Shapiro, also a Red Zone member, as made CEO of Six Flags.
The Wall Street Journal is now reporting that in recent filings with the court, attorneys for the firms holding notes for Six Flags, which is now more than $2 billion-plus in debt, singled out as questionable several actions made under Snyder’s tenure that involve Red Zone.
Among the dubiousest: Red Zone’s sale of a chunk of Dick Clark Productions to Six Flags, a deal that took place shortly after Snyder acquired the production company.
Back to us: SIX Flagging pegged that sale as fishy long ago. In a July 2008 post in this space, we called it “a bizarre transaction that essentially amounted to one of Snyder’s private equity outfits (Red Zone) making a $40 million sale to one of Snyder’s public equity outfits (Six Flags).”
Think the Private Snyder, playing with his own money, would strike a fair bargain with the Public Snyder, who was spending stockholders’ loot?
Sure he would….IN OPPOSITE LAND!
Some folks were kinder to the deal: Rick Munarriz, a pundit for Motley Fool who urged invest in Six Flags under Snyder from the time he took over as Chairman of the Board until most nails were in the coffin, called the Dick Clark Productions sale “brilliant.
The investors also called for an investigation of a school of fishy moves Snyder and the board made in April, just before Six Flags filed for bankruptcy protections, including: giving raises, doling out $4.5 million in bonuses, and pledging big chunks of equity in the company when it comes out of reorganization.
All the perks to Snyder’s insiders came as common stockholders investments were heading toward worthlessness.
If Six Flags’ portion of Dick Clark Productions was scheduled to revert to Private Snyder and his investment buddies after the re-organization, well, we might have us some trouble!
Keep the dial right here for all the breaking news in Dan Snyder’s Six Flags soap opera.