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The Batman And Robin Of Six Flags


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Pete Brecht is a theme park aficionado whose travels take him wherever roller coasters rumble. Last year, Brecht visited 19 parks, including 4 owned by Six Flags Inc. (PKS) But this summer the 37-year-old database administrator is thinking seriously about dropping Six Flags from his itinerary. Rides operating at half capacity and aggravatingly long lines exasperate him. "It's a shame because they have some pretty great [attractions]," says Brecht, of Charlottesville, Va. "But it's just not worth the hassle."

Such disappointments aren't the only knock on Six Flags, whose 30 parks are more than the combined number operated by competitors Walt Disney (DIS) and Universal. Peeling paint, bathrooms scarier than some thrill rides, and a reputation as a hangout for unruly teens have tarnished a once-proud brand. "In many respects, they've slid to the point where they resemble a souped-up county fair more than world-class theme parks," says Robert Niles, who founded themeparkinsider.com, a Web site for roller-coaster buffs.

Dan Snyder wouldn't argue the point. The cocksure investor admits that Six Flags has disappointed park patrons almost as much as it has its shareholders. He and fellow owners have watched as shares in the 45-year-old franchise tumbled from more than $40 seven years ago to about $9 while debt piled up to $2.4 billion. "The business was broken," says the 41-year-old Six Flags chairman and owner of the Washington Redskins. Snyder won a proxy fight for control of the New York-based company last fall and is now backed up by some heavyweight investors including Bill Gates of Microsoft (MSFT). More troubles may be ahead. The theme park business is cutthroat all by itself. But it also competes against other summer attractions like beaches, ball games, and movie theaters. And this year, parks could be squeezed big time if patrons decide gas prices are too high to hit the road, especially since Six Flags tickets can exceed $40.

BUGS HUGS

To fix Six Flags, Snyder hired Mark Shapiro, the 36-year-old former programming whiz who helped turn ESPN (DIS) into a ratings leader and cultural touchstone. Together, Snyder and CEO Shapiro imagine Six Flags as an in-your-backyard alternative to Disney World, where families will spend memorable days meeting street performers, getting hugs from Bugs Bunny or Superman, and sticking around past dark for nightly fireworks. At their Six Flags, live entertainment will play to packed crowds and high-tech cash registers will eliminate lines for cotton candy and souvenir T-shirts. Did we mention the restrooms? Shapiro is fussier about keeping them well-scrubbed than your mom.

Still, bringing back the fun and profits to Six Flags will be no less challenging than building a Super Bowl champ, something Snyder has yet to accomplish. "The company was so ground down, it won't reverse in a year or two," says Dennis L. Spiegel, president of consultancy International Theme Park Services. The legacy of the previous owners, led by Kiernan Burke, a onetime Drexel Burnham Lambert executive, includes a balance sheet in need of triage. Far too many parks were one-trick ponies, thrill palaces for teens but lacking enough other attractions to appeal to young families. "We just happen to have a monopoly on roller coasters," says Snyder. The result: Attendance has been flat the past five years.

Snyder and Shapiro are determined to shake things up. But whether the two strong-willed executives can play in the same sandbox is another big question. Snyder hasn't exactly been hands-off running his football team -- ask the three head coaches fired or run off in his first four years as owner. At Six Flags, though, he sees little potential for conflict. "Whatever Shapiro wants to do -- he's the CEO," says Snyder, ensconced in his corner office at Redskins Park outside Washington. Adds Shapiro: "He's there if I need him, and he's not on my back." They do acknowledge having teamed up occasionally. In October, Snyder and Shapiro jetted to Las Vegas to meet Andre Agassi and discuss an equity stake and endorsements with the tennis icon. (No deal has been inked yet.) Friends of the duo also wave off talk of dueling egos. "They're always-working, always-thinking guys who really bounce off each other well. My only fear is that they [will] burn each other out," says Michael Ovitz, the onetime Hollywood agent and power broker.

If the two succeed in reviving the chain, the rewards could be as exhilarating as a kid's first Ferris wheel ride. Snyder holds an 11.7% stake; Shapiro earns $1 million a year in salary, but stock options played a big role in luring him to Six Flags from his high-profile post at ESPN. His deal includes options to buy 950,000 Six Flags shares of common stock and 250,000 more restricted common shares. Vesting of half the common shares is tied to rises in Six Flag's price. "Load me up with options. That was my strategy going in," says Shapiro.

Shapiro, who grew up outside Chicago, fondly recalls the local Six Flags park and the ride he's still partial to: the Tilt-A-Whirl. But he's hardly nostalgic. Everything is up for reevaluation, he says. Last year he began a tour of all 30 parks and quickly demoted the gyrating, gnomelike Mr. Six, who had been the star of Six Flags' ads. The campaign, which cost about $40 million, irritated Snyder, who calls Mr. Six "creepy," and frightened little children. Shapiro says he would like to cut debt by $1 billion and is targeting several sources, including the sale of a theme park in Houston and 3,500 acres of excess real estate. To Shapiro's annoyance, much of the capital spending locked into this year's budget is pegged for roller coasters. "It has to be about the experience," he says, "not just the rides."

VALUABLE ROLODEX

Beyond this year's nuts-and-bolts reclamation of the company's finances, Shapiro's ideas include tapping into the creative world of Six Flags board member and movie mogul Harvey Weinstein, whose kid movies include Hoodwinked and Spy Kids. Characters from those flicks could end up as stars of live shows in Six Flags amphitheaters and in short movies.

For his part, Snyder's biggest contribution to Six Flags so far might be his Rolodex. The board of directors reads like a guest list at Snyder's glitzy Redskins skybox, including Weinstein, former congressman Jack Kemp, and agent Perry Rogers, whose star clients include Agassi and Shaquille O'Neal. Shapiro has already begun to think about ways to leverage the relationship with Gates and Microsoft, including turning park arcades into "interactive playgrounds" showcasing Microsoft's Xbox 360 game console. Another investor, tech billionaire Mark Cuban, is cheering Six Flags almost as loudly as he does his Dallas Mavericks. "They've shown they know how to create great entertainment," Cuban writes about Snyder and Shapiro in an e-mail.

On a visit in March to Darien Lake, outside Buffalo, Shapiro marched through a Six Flags park like he was leading an invading force, peeking into bathrooms and questioning the park's general manager about food carts left outside. He exhorted park workers to be more eager to serve customers. "That's what guests will remember," he said, "and that's why they'll come back." It sounds simple enough. But this summer the pressure to perform is also on Bugs, Batman -- and the two new guys in suits.

By Mark Hyman


Later, Baby
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