HBJ Would Sell Theme Parks, Official Says
Harcourt Brace Jovanovich would sell its six theme and entertainment parks--including four Sea World aquatic parks--for $2.5 billion, HBJ Vice Chairman Robert Edgell said Monday in an interview with a Minnesota newspaper.
“I think (HBJ Chairman William Jovanovich) is fed up with the amusement and entertainment business,” Edgell told the Duluth News-Tribune. HBJ officials Tuesday declined to comment on the interview. However, a spokeswoman for the Orlando, Fla., company did confirm that Jovanovich and Edgell recently discussed the future of the HBJ parks.
Edgell also told the newspaper that HBJ views certain Japanese firms that operate entertainment and amusement parks as “perfect potential” buyers for HBJ’s parks division. He said some Japanese firms might be interested in acquiring the kind of parks operated by HBJ.
Edgell suggested that a Japanese firm could “replicate” the Sea World concept throughout Southeast Asia and elsewhere in the world.
However, amusement park industry observers questioned whether any company--Japanese or otherwise--would pay $2.5 billion for HBJ’s six parks, even though they are highly profitable. “That seems like a very, very high price,” one amusement industry consultant said. “Bally (Manufacturing), for example, just sold its (nine) Six Flags Magic Mountain parks to Wesray for $350 million in cash.”
Turning a Profit
HBJ owns Sea World parks in San Diego, Orlando and Ohio, and it will open a $140-million aquatic park in San Antonio early in 1988. The publishing company also recently acquired Orlando’s Cypress Gardens and the former Circus World. HBJ has refurbished the aging Cypress Gardens park and has opened a “Boardwalk and Baseball” park at the former Circus World site.
HBJ’s parks division generated about 25% of the company’s $173 million in operating profits during 1986. Its core publishing business generated nearly half of HBJ’s $969 million in revenue for 1986.
However, HBJ recently agreed to spin off a trade magazine publishing division to a new company to be headed by Edgell. That sale was forced by a recent $3-billion recapitalization plan that thwarted an unwanted takeover attempt by Robert Maxwell, who owns a British media conglomerate.
That recapitalization increased HBJ’s debt load to $2.7 billion. However, Edgell told the Duluth newspaper that the proposed theme park sale was not in response to the recapitalization.
Several Japanese firms might be interested in acquiring a U.S.-based theme park, according to an accountant who is familiar with Japanese entertainment companies. Tokyu Group and Seibu, two Japanese conglomerates, for example, own and operate parks throughout Japan.
