Palace Entertainment Holdings LLC President and Chief Executive Fernando Eiroa has taken on chief executive duties at its parent company.
Newport Beach-based Palace is owned by Parques Reunidos Servicos Centrales SA in Madrid.
Palace owns or runs 17 leisure parks and five entertainment centers spread over 10 states. Leisure parks are smaller offerings than amusement or theme parks like Disneyland Resort in Anaheim or Knott’s Berry Farm in Buena Park and are often focused around a historical site or a single feature or attraction, such as water or animals.
None of Palace’s parks are in Orange County—the closest to its headquarters are Raging Waters in San Dimas and Boomers entertainment centers in Vista and Palm Springs.
Parques Reunidos has 55 parks in 12 countries.
It bought Palace in 2007 for $330 million.
It owns Palace via Delaware-based Centaur Holdings United States Inc., according to Bloomberg.
Parques itself is controlled by London-based private equity firm Arle Capital Partners Ltd.
Eiroa was unavailable for comment.
He holds both roles for now.
A Palace spokesperson said in an email, “Fernando … will split his time between the office in Madrid and the office in Newport Beach providing leadership to both regions.”
Eiroa is active locally.
He serves on the Chief Executive Roundtable at the University of California-Irvine and on the board of trustees and President’s Advisory Council at Concordia University in Irvine.
Eiroa earned an MBA from the Paul Merage School of Business at UCI, and his daughter, Cecilia Eiroa Uedo, graduated from Concordia last year.
Eiroa has led Palace since November 2007. Before that he was chief operating officer for Parques properties in Europe for three years, and worked for a telecommunications company from 1998 to 2004, Parques’ website said.
He took the top job at Parques on Feb. 1.
IPO
Eiroa was appointed chief executive as Parques prepared for an initial public offering.
He replaced Yann Caillère, who had been chief executive for two years, Parques said.
“Fernando has an excellent track record with the right attributes to take on the role,” said Fredrik Arp, an ex-Volvo chief executive who serves as chairman of Parques via his affiliation with Arle Capital, in a statement.
Parques issued shares worth about $600 million in the IPO on Spanish stock exchanges on April 29.
Arle investors sold $85 million of their stake in Parques at the same time new shares were issued in the IPO; Arle’s remaining 34% stake in Parques is worth about $480 million, a statement by Arle said.
The valuation gives Parques a market cap of about $1.4 billion.
The IPO is expected to allow Arle to exit its investment in Parques after a six-month lock-up period.
Shares in the newly public company closed last week largely unchanged from its IPO five weeks before.
Moody’s
Moody’s Investor Service in New York has said the IPO would help Palace retire about $430 million in debt that was scheduled to come due early next year.
Moody’s had briefly downgraded Palace’s corporate rating because of the debt and raised its assessment from “developing” to “stable” after the offering.
Palace issued the senior secured notes—with a rate of about 8.9% and annual interest totaling $38 million—in March 2011 with, Moody’s said, “substantially all” of Palace’s “wholly owned assets” as collateral.
The ratings service issued its reports on Palace in April prior to the IPO, coupled with praise for its 2015 results, when more than 6.4 million people visited a Palace-run Park.
Moody’s pegged Palace’s revenue for the year ended Sept. 30 at $261 million.
Arp said Eiroa “generated key acquisitions and management contracts for the group and led the U.S. business to deliver record revenue and EBITDA in 2015.”
Parques had about $640 million in revenue last year.
It recently announced a partnership with a unit of New York City-based Viacom Inc. to operate family entertainment centers in Europe carrying the Nickelodeon name.
The centers are similar to Palace’s three Boomers locations—the company sold 14 entertainment centers to Aliso Viejo-based Apex Parks Group LLC in 2014.
Moody’s said Palace’s entertainment centers—25% by property count—generate only 3% of its revenue.
Moody’s said Palace had $23 million in cash as of the first quarter of this year and expects the parks operator to spend about $38 million on capital projects this year, up from about $30 million in 2015.
