Euro Disney S.C.A. announced today that Disney is buying out Saudi Prince Alwaleed Bin Talal's Kingdom Holding Co.'s stake in the Paris resort, which would raise Disney's ownership to 85.7 percent of the company. In addition, Disney is making a €2 a share offer for all outstanding shares of Euro Disney S.C.A., in attempt to take full ownership of the company. (Here's the offer, in French.)
If Disney can get to 95 percent ownership through this buy-out offer, it would then delist Euro Disney from Euronext Paris stock exchange and complete the process of taking the holding company private.
In 2015, Disney committed to a €1.5 billion recapitalization program for the Disneyland Paris Resort, to buy out debt and invest in capital refurbishment throughout the property. Disneyland Paris' attendance has been falling, along with tourism in the Paris area in general, following the 2015 attacks in the city and a slowing economy across much of Europe.
"Today’s announcement reflects The Walt Disney Company’s continued confidence in Disneyland Paris and in France, and will enable Euro Disney to continue improving and investing in the Resort," Disney said in a statement.
If you'd like to dove into the full details of Disneyland Paris' ownership and recent financial performance, take a look at its just-published 2016 reference document. (This one is in English.)
The Walt Disney Company does not have full ownership of any of its theme parks outside the United States. Hong Kong Disneyland and Shanghai Disneyland are jointly owned with local governments and the Tokyo Disney Resort is wholly owned by Oriental Land Co. and operated under license from Disney.
Rival Universal in 2015 paid US1.5 billion to buy a controlling stake in USJ Co., which owns Universal Studios Japan, and in 2011 bought out former partner Blackstone Group to take full ownership of Universal Orlando. That leaves Universal Studios Singapore as the only Universal park not majority-owned by Universal parent Comcast.
Six Flags and SeaWorld have announced plans for new parks in China and the United Arab Emirates, and those parks will be owned by local investors and operated under license, similar to the deals that Disney has in Tokyo and Universal has in Singapore.
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TO the person who criticised the Paris and Hong kong parks, you must have been to different parks than the ones i went to.
Hong Kong when i went (9 years ago) was tiny but amazingly themed and a really nice place to be. It didn't feel like it was big wide concrete paths and there were area's to wander and explore. I also love the feel of Disneyland Paris, again, area's like the pirates play area and the Casey Jones/story book boat ride are lovely and relaxed corners of the world with side paths to explore. Alice's maze is great fun and Space mountain is a great ride.
Disney studios (or what ever it's currently called) is a bit flat but ratatouille and the surrounding area is great. The biggest issue with DLP is the people. Although they were slightly improved last year, customer service is no where near there level of customer service at the US parks. Plus our cousins in mainland Europe really struggle with the concept of queuing.
Well, in real terms, what are those shares actually worth? You paid your money and took your chances.
As for buying shares, I'd definitely consider €2 a fair price. While the shares were worth €4-6 several years ago, they've only been worth about €1.20 for the past couple years.
I don't think you understood my comment. I'm not a Eurodisney investor, I was replying to one.
Meanwhile, down at Port Adventura...
The French people are not as naturally courteous as our American cousins, they will never be Disneyfied no matter how hard the Disney University try, they will refuse to speak English wherever possible, they do not embrace "Disney" as a concept/product in the way it has been in North America and South East Asia and the location in northern France has very unstable weather. Going to any Disney park in the cold and rain or overcast and windy is not the most pleasant of experiences but in Florida and California they are the very exception to the rule. Not in Paris.
I cannot agree that it was a legacy of the Eisner era as the resort is superb, especially Disneyland Park. The Studios Park does need expanding and there are far too many average on-property hotels. But the imagination and creativity and overall wonderment of the resort, especially Disneyland, is pure Disney.
I hope that with Disney's goal of sole ownership it will ultimately achieve the success its creativity deserves but they must find ways of diluting the fundamental issues which will remain a constant. However, Paris will never replicate the American experience because of the above. C'est la vie!
With Spanish government subsidies, warm weather and proximity to Spanish beaches, Disneyland Spain could have been a massive success. But Eisner insisted on Paris, even though most of the French people and the French government did not want Disneyland in their country.
Disney's worst blunders have been committed by CEO's refusing to listen to the Theme Park Operations department: Disneyland Paris, Disneyland Hong Kong, Disneyland Shanghai and NextGen/MyMagic+/Magic Bands are all fiascos that could have been avoided if Disney CEO's had shown a little more humility.
Hubris - from ancient Greek, literally means "to stop listening".
Do they want to clear up its finances and begin to invest to bring it in line in terms of quality with the US resorts?
My guess would be they still see it as a valuable tool to get families hooked enough on the parks they then head over to Florida.
EVERYONE forgets that this park has been profitable from 'Day One' except the minute you take gross park profit and subject it to financing and royalty costs, and they pay WDCo more than one type of royalty, the massive losses appear.
WDCo taking full ownership will immediately allow for net profits and as WDCo has announced an additional $1 BILLION in capital spending beyond the current $1 BILLION for park and hotel restoration/pulsing. Also, an additional $600 MILLION will be spent on other expenses.
All WDCo shareholders will welcome this buyout as DIS stock analysts are reporting it as the WDCo turning a 25 year negative into a positive.
The question being discussed by Team Paris is if the parks should close during harsh winter months. It's an idea worth discussing!
Completely unlike us French Canadians!
That being said, I'm both happy and sad about this news. Happy that Paris might get some good investment and might sort out some of the problems (i'm looking at you WDS). The sadness is because it's going to cost me that much more to visit DLP once my discounts disappear!
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