SeaWorld Raises $702 Million in IPO, Pricing at Top of Range

SeaWorld Entertainment Inc., the theme-park operator owned by Blackstone Group LP, raised $702 million in its initial public offering after pricing the shares at the top of the marketed range.

SeaWorld sold 26 million shares at $27 each, according to data compiled by Bloomberg, after offering them for $24 to $27 apiece. The shares, which represent 28 percent of the outstanding stock, will start trading today, listed on the New York Stock Exchange under the symbol SEAS.

Blackstone chose an IPO for SeaWorld, snubbing takeover bids from Apollo Global Management LLC and Onex Corp., because the firm expects the offering to yield better returns over time than a sale, a person familiar with the matter said earlier this year. At the offering price, Orlando, Florida-based SeaWorld’s market value is about $2.5 billion.

SeaWorld, famed for its killer whales named Shamu, had about $191.7 million in capital expenditures in the 12 months through December and free cash flow of $111.8 million, according to regulatory filings and data compiled by Bloomberg. The company operates 11 theme parks, including two under the Busch Gardens brand.

Much of SeaWorld’s capital spending went toward future attractions and animal-safety measures, filings show. The company described those costs as “elevated” for 2011 and 2012, and plans to reduce its level of expenditures to an average of about 10 percent of total revenue starting in 2014, excluding safety and infrastructure investments.

Long-Term Debt

SeaWorld will have about $1.6 billion of net long-term debt after using IPO proceeds to repay borrowings, according to its prospectus. Blackstone took control of SeaWorld in 2009 after agreeing to buy Anheuser-Busch InBev NV’s amusement-park business, in a transaction then valued at as much as $2.7 billion.

Blackstone, which owns all of SeaWorld’s equity, will hold about 68 percent following the sale. The IPO price values Blackstone’s stake, along with the cash received from the IPO, at about $2.2 billion, more than twice the firm’s $1 billion equity investment in the 2009 leveraged buyout, according to data compiled by Bloomberg and a person with knowledge of the original transaction. Including dividends of more than $600 million that SeaWorld had already paid Blackstone over the past two years, it’s almost three times Blackstone’s initial investment.

Goldman Sachs Group Inc. and JPMorgan Chase & Co. led the sale.

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