Six Flags Entertainment Stock Rises Premarket: Activist Investor Puts Pressure To Spin Off Or Sell Theme Park Real Estate

Six Flags Entertainment shares were up 2% in early premarket trading on Friday, following a report saying that an activist investor and shareholder plans to push the theme park company to spin out or sell its real estate and make other changes.

Land & Buildings Investment Management, which has built up a 2% stake, is engaging with Six Flags and claims that the company's 2024 merger with Cedar Fair has not worked out as planned, according to a Wall Street Journal report, published late Thursday.

Notably, Six Flags shares have declined by more than 55% year-to-date, amid business underperformance due to a host of problems, including adverse weather conditions.

Land & Buildings, which ran a similar campaign against MGM Resorts in 2015, wants Six Flags to spin out its park real estate into a new real estate investment trust (REIT) entity, according to the WSJ report, which cited unnamed sources.

Six Flags should evaluate an outright sale of its real estate, which Land & Buildings believes could be worth as much as $6 billion.

On Stocktwits, the retail sentiment for FUN was 'neutral' as of early Friday.

In 2023, Land & Buildings founder Jonathan Litt publicly pushed for changes at the company. However, a few months later, Six Flags announced its merger with Cedar Fair, in a bid to create a regional, theme-park powerhouse.

Six Flags shares currently trade close to a five-year low. The company had a market cap of $2.1 billion as of Thursday.

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