Walt Disney seeks control of Euro Disney

Walt Disney Co. is to seek full control of Euro Disney after raising its stake in the underperforming operator of Disneyland Paris through a deal with Prince Alwaleed bin Talal.
Disneyland Paris opened in 1992 and has struggled financially for much of that time, after making overly optimistic visitor projections and taking on too much debt.
It sits on a 5,510-acre site about 20 miles east of Paris, only about half of which has been developed so far, Disney said in its 2016 annual report.
Disney said on Friday it was offering €2 ($2.13) a share for any remaining shares in Euro Disney after buying a 9 percent stake from Alwaleed’s Kingdom Holdings via a share swap, increasing its holding in the European company to 85.7 percent from 76.7 percent.
If it gets to at least 95 percent it will buy out and delist the shares from the Euronext Paris stock exchange, it added.
The offer represents a 67 percent premium to the closing price of Euro Disney shares on Thursday. Minority shareholders have long complained about the way the company was run and Disney could face resistance to the offer despite the premium.
Euro Disney’s finances have been hit by the 2015 Paris attacks, which have led to fewer visitors to the French capital and by tough business conditions throughout France and Europe in 2016, Disney said in a statement.
The French offshoot of the US media and theme park empire has been struggling under increasing losses, recording a 2016 net loss of €858 million, from €102 million in 2015.
Walt Disney reiterated it would support a recapitalization of up to €1.5 billion ($1.6 billion), which would help to cut Euro Disney’s debt and improve its financial position.
Euro Disney was Europe’s largest-ever initial public offering (IPO) when it floated and analysts thought Euro Disney stock promised “good long-term returns,” but it never delivered on that promise, leaving many shareholders with losses.
Walt Disney has since increased its holding in its European offspring and earlier on Friday the US company said it had swapped a 9 percent stake with Saudi Arabia’s Kingdom Holding, the investment firm owned by Prince Alwaleed.

Source: Arab News