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The plausible scenario in which Dreamworld closes permanently

17 posts in this topic

The plausible scenario in which Dreamworld closes permanently

Though sensationalised reports in the media suggested that Dreamworld may never reopen, the park will likely resume business in the near future. The unprecedented accident on its Thunder River Rapids ride however, could set into motion the theme park's sale or eventual closure.

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Good article Richard. 

I see selling as a distinct possibility, maybe to Wanda or another operator looking to enter the Australian market. There is no doubt the park will be worth less in 6-12 months than it was worth 8 days ago, and the value will likely continue to drop until a significant capital expenditure occurs to draw crowds back. With Ardents focus on ME in the US, I can't see them persisting with any significant investment in a business that is seeing attendances & consumer confidence drop. 

DW is prime for the picking imo.. and Ardent pay just decide the best idea is to get through the current investigation, let some time pass, and then cut & run and let someone else try and restore the park to its glory 

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I think that this article can be extended to the GC theme park industry in general, I'm sure attendance will drop all-round. Even one of my friends says he doesn't want to go to theme parks any more due to DW's incident (although surprisingly all my other friends understand the safety measures that the park does put in play).

(of course, I don't expect the second part of the article to apply all-round, just the bit on the attendance being affected)

Edited by Santa07

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Good one Richard. I think this is the perfect time for someone to swoop in, claim "under new management" and invest some serious money on the place.

Oh, and I reckon they could, just maybe, get a nice little discount if things for DW aren't looking up soon.

Edited by ash.1111

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Obviously this had major effected the park, but I don't think we will no the full effect it has had until the park reopens, and the summer holidays arrive. I'd like to think that a lot of locals will show their support to the park, which I will be. But until the usual January madness at the park arrives, I think that will give the true indication have much this incident has effected the park.

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I don’t know if the land would be worth 250 million to developers.  The Queensland government current land value is 135 million.  If the land was changed from its current use to something else, then I would be surprised if Ardent got anymore then the undeveloped value of the site.  Unless you are saying the developers would make 250 million.  I thought Ardent sold the other block of land which is around 1/5 of what’s left for 10 million.

I do agree that Ardent do have stormy seas ahead.  I suppose it just depends on how big Ardent's boat is and how long it can take a battering.

Edited by YLFATEEKS

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1 hour ago, themagician said:

I'd like to think that a lot of locals will show their support to the park, which I will be. But until the usual January madness at the park arrives, I think that will give the true indication have much this incident has effected the park.

Little Mr 4yo asked last night if we can go to Dreamworld soon...  He is now tall enough for a whole new bunch of rides...  We told him he has to wait a little while but when we can we will head there...

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A few clarifications to the article in terms of various values.

Of interest is the added Credit Suisse estimates of $9 and $14m EBITDA for the coming financial years. That's would be a $50m  loss to Ardent Leisure against if this incident hadn't occurred. The thoughts of Ardent Leisure 'doubling down' on this loss to properly redevelop and revitalise that whole section of the park is almost illogical from a financial view.

@YLFATEEKS Ardent Leisure's carrying value for Dreamworld's land and assets is $235m. I've updated the article to reflect these figures. 

If we're picking and choosing potential buyers, Merlin strikes me as a more likely candidate. They have a presence in Australia and a long history of acquisition. Is Dreamworld the sort of asset that Wanda would want to work with when their current modus operandi is to build from scratch?

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I like the idea of merlin being a potential buyer  they have been heavily investing in Australia of late. I really hope dreamworld try's to turn their bad luck around and the park eventually gets back on its feet wether that be with a new owner or not I just hope it doesn't become a victim to blood sucking property investors like Australia's Wonderland 

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Can't really see the property investors being as much of an issue here as the case with Wonderland. For starters the area is not exactly already somewhat built up. There also isn't the whole interchange of two major motorways next to the park.

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