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Breaking: Twdc loans 1,3 billion to eurodisney

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  • News Breaking: Twdc loans 1,3 billion to eurodisney

    Source: http://corporate.disneylandparis.com...ss-release.pdf

  • #2
    Re: Breaking: Twdc loans 1,3 billion to eurodisney

    Not the total buyout that was rumoured, but this should prove equally effective for actually allowing EuroDisney to invest in the parks. One has to imagine they already have plans lined up, hopefully the turn-around time won't be long.

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    • #3
      Re: Breaking: Twdc loans 1,3 billion to eurodisney

      That was a large chunk purchase though.
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      • #4
        Re: Breaking: Twdc loans 1,3 billion to eurodisney

        They didn't purchase more stock, just took on their bank loans and offered a lower interest rate/more forgiving repayment. Important distinction, but this option actually fixes the problem rather than Disney purchasing more stock.

        The real problem is not ownership but the huge loans and strict bank rules that prohibited them from making capital expenditures (i.e. investing in the park). With those lifted, and a lighter repayment plan short term (5 years), this gives them a significant amount of cash to invest. The ability to invest in the parks was really the whole reason this was done. I think Disney has learned well from DCA that proper investment can really turn a park around.

        I'm sure this has been on the back burner for a while, once DCA exceeded expectations they pulled the trigger.

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        • #5
          Re: Breaking: Twdc loans 1,3 billion to eurodisney

          This makes more sense than purchasing more stock. In that thread we were already wondering about the debt. By having more of the debt being owed to The Walt Disney Company instead of third parties, more flexibility can be offered without the cost of buying the stock, which jumped with rumors of the impending purchase.

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          • #6
            Re: Breaking: Twdc loans 1,3 billion to eurodisney

            This solution is way better than buying out the resort. TWDC always had the last word in decisions and appointing the management, so a buyout wouldn't have changed that. In addition the debts would still be with the banks and not with Disney, which is the case now. With TWDC owning the debt it's a lot easier to establish a good repayment plan over the next years. That gives ED SCA more flexibility in investing into the resort. However just because TWDC owns the debt now, doesn't mean it's gone. I'm pretty sure TWDC wants its money back. It just gives ED SCA more time to repay. And €400mio are still with the banks.

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            • #7
              Re: Breaking: Twdc loans 1,3 billion to eurodisney

              Good news, makes me wonder if its still part of the grander scheme. Let them right the ship first and then look to purchase the company - less headaches that way.
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              "We're not trying to entertain the critics ... I'll take my chances with the public." -
              Walt Disney

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