Dreamworld operator Ardent Leisure running out of money

Ardent Leisure’s market value hit almost $60m on Tuesday, against $753m only in February.

Dreamworld owner Ardent Leisure may have missed its opportunity to raise equity, but it is understood to be not from a lack of trying.

It is understood that the Dreamworld owner thought about a move to tap the market over a month ago, but decided it would not be able to get a deal away at $1.40 per share, which was the asking price of an equity raising it was prepared to do.

This is because it would not be able to get a deal underwritten at that price.

Now that the company has no money coming through the door, with the closure of Dreamworld and its US-based Main Event entertainment business, it needs to raise money more than ever.

Ardent is understood to have been working with Goldman Sachs on a full or partial sale of Main Event since the middle of last year. It is believed to owe money to the tax office and for one of its rides, which could be deferred.

However, equity investors would be concerned when the company does not appear to have enough cash on its balance sheet to pay expenses in the months ahead without any income. On Tuesday, its market value was almost $60m; it was worth $753m only in February.

Based on the results for the six months to December, Ardent had about $58m of cash on its balance sheet and more than $189m of operating expenses.