Bankers bicker over Euro Disney

PARIS (Reuters) – As Euro Disney prepared to mark its second anniversary today, bankers to the debt-strapped theme park were playing a high-stakes poker game Monday over its 21 billion franc ($ 3.59 billion) rescue package.

Euro Disney hopes to put the last two years of recession-filled doom and gloom behind it as it launches new attractions for the key spring and summer seasons.

But to secure its financial future, its bankers must first agree a debt restructuring, which centers on a vital cash injection of 6 billion francs ($ 1. 03 billion) in new shares, half to be subscribed by U.S. parent Walt Disney Co.

Friday deadline

The French banks leading an outline package, Banque Nationale de Paris and Indosuez, were meeting Japanese bank lenders late Monday afternoon to persuade them to accept the deal by an informal deadline of Friday, senior bankers said.

But some Japanese banks told Reuters that, as creditors who lent on senior (priority) terms, they are unhappy about underwriting the shares not subscribed by Walt Disney, when banks that lent on junior terms are not being asked to face that risk in proportion to their subordinated lending.

These senior-ranked banks, who are joined by other foreign lenders, fear if the share-rights issue is not completely successful, they will be left with Euro Disney shares that no one wants.

One banker involved in the deal told Reuters: “The point in these types of negotiations is ‘Everybody pays, except me.’ ”

Revisions nixed

So far, the joint steering committee of banks that drew up the deal has refused to revise the package.

Asked if the differences could be overcome, a second banker said: “You never give away your bottom line beforehand. I expect there will be some sort of resolution. Then again, maybe not. … For some people there comes a point when it doesn’t seem worth it.”

The theme park hopes to welcome its 20 millionth visitor by its second birthday and is planning rides for later this year, including one based on Jules Verne’s Nautilus submarine, and next year Discovery Mountain — an advanced version of Space Mountain in Anaheim.

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