June 23 (Bloomberg) -- Shares of Six Flags Inc. tumbled 26 percent, the biggest drop in almost four years, after the theme- park company said it is seeking buyers for six of its 30 properties and attendance plunged this year.

Visitors fell by as many as 1.3 million through June 18, a 13 percent decline from a year earlier, while spending on staff is rising, the New York-based company said yesterday. Six Flags said it's close to violating the terms of $1.04 billion of loans and is negotiating amendments with banks.

Seven months after ousting former Chief Executive Officer Kieran Burke, Chairman Daniel Snyder and new CEO Mark Shapiro are paring less-profitable parks in the U.S. West and Southwest.

``There is strong interest in the market place,'' Shapiro said in an interview yesterday. ``We are moving into discussions with parties that have shown interest.''

Shares of the second-largest U.S. theme-park operator plunged $1.90 to $5.55 at 4:01 p.m. in New York Stock Exchange composite trading. The drop was the biggest since August 2002, when the stock fell 57 percent.

Before yesterday's announcement, the shares were up 36 percent since Snyder announced his intention in August to replace three Six Flags board members.

Standard & Poor's Ratings Services today changed its outlook on the theme-park operator's credit quality to negative from stable and may be more inclined to cut its credit rating.

``It's a restructuring that will take awhile to work out,'' said Philip Tasho, chief investment officer at Tamro Capital Partners LLC in Alexandria, Virginia, which manages $450 million, including Six Flags shares. Shapiro's ``strategy makes sense. It's a matter of execution.''

Amusement Park Sales

Six Flags' decision to sell comes a month after Cedar Fair LP, the owner of amusement resorts such as Knott's Berry Farm, agreed to buy the five-park Paramount Parks unit of CBS Corp. for $1.24 billion. Walt Disney Co. is the biggest U.S. theme- park operator.

Ticket sales declined as Six Flags raised prices to keep rowdy teenagers out of its parks, executives said.

``This brand is much more damaged than we previously thought,'' Shapiro, 36, said in a conference call yesterday. ``We are driving out a certain segment of the teen population: Those that loiter, those that smoke, those that don't spend money, those that drive up our security problems.''

Attendees Spending More

Shapiro said the people who do come to the parks are spending more. Visitors each spent an average $4.12 more at the parks than they did a year earlier, an increase of 14 percent, as the company promoted more entertainment events.

Revenue in 2006 was down 1 percent from a year earlier.

``It's exactly what we were looking for,'' said David Miller, a Los Angeles-based analyst with Sanders Morris Harris Group. ``What matters a lot more is per-head spending.''

Under review are facilities in Seattle, Denver and Houston, as well as the company's Magic Mountain property in Los Angeles. Other parks up for sale are a facility outside Buffalo, New York, and one in Concord, California. The company started in 1961 as the Six Flags Over Texas theme park.

Magic Mountain may fetch as much as $300 million just for its land, said Miller.

Likely bidders for the six parks include private-equity players and real-estate developers, Dennis Speigel, president of International Theme Park Services Inc., a theme-park consultant based in Cincinnati, said in an interview.

Price Targets Cut

Some analysts cut their 12-month price targets on the stock. New York-based Prudential Equity Group LLC analyst Katherine Styponias, who has an ``underweight'' rating on the stock, cut her target yesterday to $6 from $9. Bear, Stearns & Co. analyst Glen Reid reduced his target to $8 from $12. He rates the shares ``outperform.''

Six Flags will boost spending by $15 million this year on top of a $45 million increase already planned to hire staff and lure back customers, Shapiro said.

The company probably won't meet its previous forecast of $340 million in earnings before interest, taxes, depreciation and amortization this year, Shapiro said.

``It's going to be exceedingly difficult to hit that guidance number given the teenage drop-off we've had, driven by season-pass sales,'' he said. Sales of the passes are down 550,000 this year.

$2.1 billion In Debt

Six Flags, which has about $2.1 billion in debt, owns 3,500 acres of excess land it's looking to sell. The company wants to pare debt to $1.6 billion. Six Flags didn't disclose details of its discussions with banks, which are led by Lehman Brothers Holdings Inc., according to data compiled by Bloomberg.

Under Burke, sales at Six Flags had fallen for two straight years. Attendance dropped 3.4 percent to 33.5 million in 2004. The company has posted seven consecutive years of losses. Snyder persuaded investors to oust Burke in November, then installed Shapiro, a former programmer at ESPN, as CEO.

Six Flags' 9.625 percent note maturing in 2014 fell 3 cents on the dollar today to 90.75 cents on the dollar to yield 11.427 percent, at 4:31 p.m., according to Trace, the bond-price reporting service of the NASD.

To contact the reporter on this story: Josh Fineman in New York at jfineman@bloomberg.net.

Last Updated: June 23, 2006 16:42 EDT