Six Flags Inc., the world's second-largest theme park operator, put itself up for sale Tuesday and urged shareholders to reject a bid by Washington Redskins owner Daniel Snyder to wrest control of the company.
Shares surged 11 percent after the company said in a statement that it will pursue an auction. Snyder, the largest shareholder, offered $6.50 a share to almost triple his stake in a proposal that would oust chief executive Kieran Burke and three board members, Newsday reports. Shares rose 65 cents, or 9.9 percent, to $7.19 in morning trade on the New York Stock Exchange. The stock rose more than 10 percent in earlier trade.
The theme park operator also said it plans to oppose Red Zone's attempt to gain effective control of the company.
"If Red Zone commences a consent solicitation, the board urges Six Flags stockholders not to sign any consent form they may receive from red Zone and will request that sockholders revoke any consent they may give," the company said in a statement.
Matthew Harrigan, an analyst with Janco Partners Inc., said potential buyers would be few and far between. He ruled out larger rival Walt Disney Co., according to Reuters.
"Disney has a very different business. Disney is a destination parks business, and Six Flags is a regional chain, catering to locals," he said.
Six Flags runs 30 amusement parks, but its properties do not have hotels. The chain's revenue and profit have lagged behind in recent years - it posted a profit in the most recent quarter, but has reported annual losses since 1999.