NEW YORK – Shares of Six Flags Inc. (PKS) rose more than 18 percent Thursday, a day after the owner of the NFL's Washington Redskins (search) said he was seeking to replace the theme park operator's management and raise his stake to up to 34.9 percent.
Daniel Snyder's (search) company, Red Zone, would offer $6.50 for each Six Flags share, it said late Wednesday in a preliminary letter to shareholders that was included in a regulatory filing.
The offer represents an 18 percent premium to the Six Flags closing price of $5.49 on the New York Stock Exchange on Wednesday.
Shares rose $1.01, or 18.4 percent, to a 52-week high of $6.50 in Thursday morning trade.
"We would take the offer or sell the shares on strength," Prudential Equity Group analyst Katherine Styponias said. She added that the only ways of the stock climbing any higher would be an increased offer from Snyder, better-than-expected operating results from Six Flags, and the belief that should Snyder be successful, execution of his plans offer further upside.
"We think the (better-than-expected earnings) is largely baked into the stock already," she said.
Snyder's plans include replacing current management including Chief Executive Kieran Burke and Chief Financial Officer James Dannhauser.
In the filing, Snyder solicited stockholders to agree to removing three board members, increasing the number of board members to seven and requiring a unanimous vote for any change in that number .
Six Flags said its board would consider Red Zone's (search) filing, but noted that shareholders need take no action at the present time.
Six Flags posted a profit in its most recent quarter but has reported annual losses since 1999. Shares reached a 1999 high of $41.63, but have fallen steadily since, with the exceptions of a rally in 2003 and a 2.2 percent gain so far in 2005.