Disney’s plan is no Mickey Mouse deal
£1.3bn pledge to ailing Paris park
DISNEY has vowed to pump another £1.3billion into ailing theme park Disneyland Paris.
The pledge came as the US entertainment giant launched a bid to take complete control of Euro Disney – weeks before the resort marks its 25th anniversary.
Disneyland Paris is a popular destination for UK families but has struggled with sky-high debts, lacklustre visitor numbers and heavy losses.
The Walt Disney Company owns a 76.7% stake in the resort after a £780million bailout in 2014.
It will increase that to 85.7% by acquiring most of the shares currently owned by Saudi Prince Al-Waleed Bin Talal for £120m. The Prince bought a 10% stake in 1994.
Disney also wants to buy out the remaining shareholders for £190m.
Only then would it inject the £1.3bn to “continue the implementation of improvements at Disneyland Paris, reduce debt and increase liquidity”.
It said the park’s finances had been “significantly impacted” by the fallout from the Paris terrorist attacks in 2015 and “challenging business conditions that continued through 2016 in France and throughout Europe”. However, it could face opposition from small investors who are demanding the return of £790m.
Activist hedge fund CIAM is leading a group that claims the theme park has been crippled by grossly inflated licence and royalty fees.
Walt Disney charges the park for using its animated characters, such as Mickey Mouse, fees which, CIAM says, are three times the market rate.
Anne-Sophie D’Andlau, CIAM founder, said: “I imagine that most of the families who visit Euro Disney every year have no idea that such a large part of the money they spend goes straight back to Walt Disney in the form of inflated fees.”