Walt Disney Co. is throwing a lifeline to Disneyland Paris in a bid to revive the 22-year-old theme park that is struggling with falling attendance and mounting losses.
Euro Disney SCA, the resort’s operator, said it plans a 1 billion euro (US$1.25 billion) refinancing backed by its US parent, Bloomberg News reported.
Walt Disney, which owns about 40 percent of the French company, is required to make an offer for all Euro Disney shares as a result of the recapitalization, the report said.
Disneyland Paris has been suffering losses for years amid Europe’s weak economy. It said attendance could drop by up to 800,000 this year.
“This recapitalization plan would improve Euro Disney Group’s financial position and enable it to continue investing in the guest experience,” Walt Disney said in a statement. “We are demonstrating The Walt Disney Company’s continued confidence in Disneyland Paris.”
The refinancing includes a capital increase of about 420 million euros made or backed by Walt Disney and the conversion of 600 million euros of debt owed to its US parent into Euro Disney shares, the report said.
Net loss at Euro Disney will probably widen to as much as 120 million euros this year from 78 million euros in the previous period, while sales will decline as much as 3 percent, the company said.
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