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Disney Unlikely To Spin Off Theme Parks Business - Forbes 3/30/06

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  • Disney Unlikely To Spin Off Theme Parks Business - Forbes 3/30/06

    Disney Unlikely To Spin Off Theme Parks Business
    Forbes 3/30/06

    Disney Unlikely To Spin Off Theme Parks Business

    The Walt Disney Company is currently reviewing its strategy for its theme parks business, but a spin-off is unlikely, according to a recent report from Banc of America Securities.

    Disney recently reiterated its goal of achieving 20% domestic theme parks margin guidance within the next few years. It also stated that the parks can continue to deliver 2% to 3% attendance growth and price increases at or above inflation.

    Despite speculation that Disney could be willing to sell its hotels or possibly spin off the entire parks division, the company's chief financial officer recently implied that such steps are unlikely because of tax consequences following a restructuring, as well as the corporate philosophy that ownership and operation of the hotels remain an integral part of the theme parks' success.

    Disney's theme parks boast an enduring popularity, but they're unlikely to ever show the leverage exhibited in the past, according to Banc of America. The research firm cited rapidly increasing health-care and benefits costs.
    Disney Unlikely To Spin Off Theme Parks Business
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