DREAMWORLD UNDER 'REVIEW' BY OWNERS ARDENT LEISURE AS ACTIVIST INVESTORS PUSH FOR BOARD POSITIONS

Written on the 25 May 2017 by Ben Hall

DREAMWORLD UNDER 'REVIEW' BY OWNERS ARDENT LEISURE AS ACTIVIST INVESTORS PUSH FOR BOARD POSITIONS
DREAMWORLD owner Ardent Leisure (ASX: AAD) is considering the future of the theme park which may be redeveloped or sold off as the company also faces a board push from activist investors.

Ardent says it is "reviewing" its options with regards to real estate assets at the Gold Coast theme park where four people died in October following a catastrophic malfunction on the Thunder River Rapids ride.

In a statement to the ASX, the company acknowledged Dreamworld is "located on prime real estate adjacent to the new Coomera town centre and core infrastructure".

"The review is considering a number of important factors including the impact of recent events at Dreamworld, the feasibility of rezoning parts of the site for alternate uses and analysis of the existing Dreamworld footprint to identify potential opportunities for unlocking value," the statement says.

"As part of this review Ardent has appointed a town planner to assess the feasibility of rezoning parts of the (Dreamworld) precinct.

"Ardent has, and will continue to, engage with third party developers to discuss potential development opportunities and timing for any redevelopment within the precinct."

The Dreamworld precinct covers 60 hectares with the park itself occupying 35 hectares and there is 25 hectares of surplus land. The company says it will "continue to invest in Dreamworld to facilitate its recovery and ensure it remains one of the Gold Coast's key tourist attractions".

Despite heavy ticket discounting and marketing, Dreamworld's attendance figures continue to be a problem and in a trading update earlier this month the company reported visitation was down 36.7 per cent and revenue was down 38.9 per cent. Ardent says it expects the theme park division will report a loss of between $2 million and $4 million for FY17. 

In February, Ardent Leisure posted a loss of $49 million in the first half of the financial year after slashing the value of the theme park by more than $90 million. 

Meanwhile, Ardent is facing a push for board representation from two activist investors who have bought 7.9 per cent of the company.

Ariadne Australia directors Gary Weiss and Kevin Seymour have a reputation for initiating major management and operational changes and Ardent confirmed it had been approached about their potential appointments.

The company says it will consider the request, but also announced it was looking to appoint "one or potentially two" US based non-executive directors to the Ardent board.

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Author: Ben Hall

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