Shareholders of Euro Disney, which include Saudi businessman Prince Alwaleed bin Talal, on Tuesday approved a recapitalisation plan to raise €1 billion ($1.18 billion) to revive the struggling Disneyland Paris theme park, which last year reported a full year net loss of €113.6 million and a 2 percent decline in overall revenues, AFP reported.
At a general assembly meeting in Paris, the stakeholders voted in favour of a series of measures including €420 million of fresh funds from parent group The Walt Disney Company. The deal also involved the conversion of €600 million of debt into equity.
As a result, parent firm Walt Disney will own at least a 70 percent of EuroDisney, while Alwaleed will be the second biggest shareholder with a 10 percent stake.
In November, Euro Disney reported a net loss of €113.6 million for the full year to September 30, as revenues declined 2 percent year-on-year.
The net loss increased 45 percent year-on-year, with 2013 reporting a net loss of €78.2 million.
In what the Paris-based French theme park described as “a prolonged challenging economic environment, particularly in France,” total revenues decreased two percent to €1.3 billion.
Commenting on the results, Tom Wolber, president of Euro Disney, said: "Results for the year were impacted by the continued economic softness, notably in France. Volume declines reflected the economic context…. and an approximately 10 percent reduction in our room inventory.
“Despite the challenging economy, we continued to invest in the guest experience with this summer’s successful opening of the new attraction Ratatouille: L'Aventure Totalement Toquée de Rémy, driving increased guest satisfaction and spending.”
In October, it was announced Prince Alwaleed had agreed to join the €420 million bailout of Euro Disney, the Paris theme park’s parent company.
His support was seen as a crucial vote of confidence in the company, The Mail on Sunday report said.
Disneyland Paris racked up a net loss of $964 million in its first year of operation in 1992 and has only turned a profit in eight of the past 22 years.
Despite recording 14.9 million visitors last year, the theme park lost $99 million.
Prince Alwaleed told the newspaper he had been impressed during his visit to the park and would continue to support the company.
“We will fully subscribe to the rights issue because we support France and we support Disney,” he was quoted as saying.
“They will not take our stake. We will maintain 10 percent.
“Operationally there is no problem at all. I went to the hotels. I skinned the park, I skinned the hotels, I skinned everything. Meticulous. It is a top-notch tourist destination.”
However, he said visitor numbers to Disneyland Paris, the most popular tourist destination in Europe, had been disappointing.
“Two years ago we had 16 million visitors to Euro Disney, with half from France. Now it is down to 14 million and most of the loss comes from France. But we are seeing a plateau because revenue was up this quarter,” he said.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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