Great Wolf Howls with Delight After Shares Surge

It was revealed on Friday that Great Wolf (WOLF) saw shares surge after Apollo Global Management

raised its bid for WOLF for the second time in a week. APO's offer now tops an offer from KSL Capital Partners. Following the news, shares in WOLF rose 7.8% to $8 on Friday morning. Apollo's new offer of $7.85 per share is being backed by the board. The total offer is roughly $740 million, including debt. As far as we are aware, this is the third time that Apollo has raised its bid for WOLF. Apparently, it really wants the water parks operator, and it is not giving in despite the legal issues that have plagued the deal. Shareholders sued WOLF following APO's initial proposal in mid-March of $5 per share. They claimed that Great Wolf didn't do enough to obtain the highest possible offer. On Thursday, KSL offered $7.25 per share, and that marks its own third attempt to buy the company. It will be interesting to see if KSL raises its offer again, but it does seem that we are seeing a bidding war for Great Wolf between Apollo and KSL. On April 16, Hilliard Lyons published a research report stating that its advice following Apollo's initial offer in mid-March was to hold existing positions and let the situation play out. At that time, Hilliard Lyons still preferred that course of action for WOLF shareholders. Shareholders may get $7.00 per share if the latest offer from KSL is successful or could receive a potentially higher price if a follow-up offer is made. Should an acquisition of WOLF be unsuccessful for some reason, it believes current fundamentals could support a stock price in the $5-$6 per share range.