Business
Sunday, Feb. 01, 2009
Hard Rock Park buyer pulled out hours before signing
Lisa Fleisher - The Sun News
WILMINGTON, Del. -- Hard Rock Park almost got a chance at a comeback.
A Texas-based company was lined up to buy the $400 million theme park for $35 million, but the deal fell through at 4 a.m. on Dec. 30, the date of a scheduled court hearing, according to transcripts from that day's proceedings.
That company, Marlin Atlantis, a Dallas-based real-estate developer, is looking to branch out into entertainment with experienced partners, and remains interested in Hard Rock Park, a spokesman said. On the night before the hearing, the company was poised to buy the park and to help with an additional multimillion-dollar loan to pay for administrative expenses through March.
"As those negotiations were down to dotting i's and crossing t's ... we were informed at approximately 4 o'clock in the morning last night that Marlin Atlantis had elected to walk away from the deal," said the park's lawyer, Paul Harner, according to the transcript of the proceedings in Delaware bankruptcy court.
Marlin Atlantis spokesman Howard Falkenberg, however, said it was a Hard Rock Park lender that balked, noting that Marlin Atlantis had already wired in $5 million.
"We think the project is a good fit for Marlin Atlantis," Falkenberg wrote in an e-mail. "Our entertainment consulting team is among the best in the world and we believe we could make a real difference."
After the deal's collapse, with cash dwindling and time running out, the lawyers said they had no choice but to convert the case to a Chapter 7 bankruptcy, liquidating the park and turning it over to a government-appointed trustee.
It was the final disappointment of a heart-breaking year for the rock 'n' roll theme park, which debuted and flopped the year the country plunged into a deep recession.
The theme park, which was built in under two years just off U.S. 501 near the Intracoastal Waterway, featured rides set to music of classic rock bands. The park blamed a slump in tourism when it filed for Chapter 11 bankruptcy protection in September, but critics said the $50 ticket price was too high, the theme wasn't right and the park's management did not spend enough on advertising.
There's still hope left for life after rock. Area business leaders say several companies are interested in the park.
"It's disappointing that a deal hasn't been struck to date," said Hugh Owens, president of the Myrtle Beach Regional Economic Development Corp., which has been trying to woo buyers.
He said interest picked up again after the park filed for Chapter 7 on Jan. 2.
Most companies have told locals they would make several changes, including dumping the pricey Hard Rock theme.
Inquiring companies also say they would have to pour tens of millions into the park, buying new rides, retheming the place and splurging on advertising.
"The one thing we've heard from everybody is the park as it's structured today is not a viable attraction," said Brad Dean, president of the Myrtle Beach Area Chamber of Commerce, who has met with representatives of several interested companies, including Marlin Atlantis.
The park decided in late October to try to auction itself off so the next owner could get the amusement ready in time for the 2009 season, according to a transcript of an Oct. 22 hearing.
A new owner would need two to three months to get ready for the new season, Harner said on Oct. 22.
The judge, Kevin Carey, agreed to an auction with a minimum bid of $35 million, with 10 percent in cash and other requirements.
The auction, scheduled for Dec. 15, never happened.
"Instead, what ensued was some 13-plus hours of what I would characterize as fairly robust negotiations with at least half a dozen interested parties in an effort to try to improve the proposals that they had made," Harner told the judge at a Dec. 18 hearing.