Little known about bidders aiming to wrest control from Disney
This article was updated at 7:14 p.m.
Mystery — make that bafflement — surrounded a little-known Swiss company’s claim Thursday that it will launch a bid to take over debt-laden EuroDisney “in the next days.”
A press conference in Paris was punctuated by guffaws from increasingly skeptical journalists as Ulf Werner, chairman of Center Tainment, and other reps stumbled their way through an explanation of the company’s plans, unsure of their numbers and somehow managing to leave out anything of substance.
Jaws dropped when Kurt Andreesen, described as a consultant to Center Tainment, said the bid wouldn’t be made Thursday “because unfortunately the company’s legal counsel is sick.”
But the Center Tainment people were clear about their intention to gun for The Walt Disney Co., 39% owner of the French theme park operator, with a view to slashing by some $20million to $30 million a year burdensome royalties and management fees EuroDisney pays the Mouse House.
“Other shareholders, not only Walt Disney, should also participate in the profit of the company,” said Andreesen.
Thomas Von Hagen, a former Euro Disney staffer who is now Center Tainment’s operational head, said later that the company had been in contact with Walt Disney and Prince Al Waleed bin Talal of Saudi Arabia, who owns a 10% stake, and that they would be talking to both again today. Hagen insisted: “There is enough money for EuroDisney but it is going to the wrong place — America.”
Center Tainment plans to wrest control of EuroDisney via an all share offer for the company’s free floating stock, to obtain a 50% stake, Andreesen explained.
The Teutonic financier seemed unconcerned when a journalist pointed out that EuroDisney has special status giving The Walt Disney Co. control of it regardless of the size of its stake — Lagardere and Michelin are two French companies with similar ownership rules.
When asked about the share swap, Andreesen wasn’t sure how many Center Tainment shares would be offered for how many EuroDisney shares.
“It will depend on our share price,” he said, explaining that as Center Tainment belonged to just 45 shareholders (with 1% floated on the Frankfurt stock market since September) the share price fluctuated wildly, which made it hard to come up with a number.
If EuroDisney’s shareholders don’t want Center Tainment’s stock — and on Thursday that was sounding like a distinct possibility — the people behind Center Tainment would make a cash offer, Andreesen said.
“We are in a position to manage the park without Walt Disney if necessary,” he asserted bullishly, saying that Center Tainment, a company with no operational activities, had staff experienced in theme park management and ambitions to take over other facilities, as well as EuroDisney.
However, the press conference kept hard facts to a minimum.
Werner refused to say who or what is behind Center Tainment, beyond that its core shareholder was “a German company.”
“We will give more details but we won’t do it today,” Werner said enigmatically.
Nor were any details forthcoming about which banks might support the bid.
“How are you going to finance this takeover? Why should EuroDisney share holders believe in you?” were questions that met with blank faces.
Billed as Europe’s most popular tourist attraction, Disneyland Paris received 12.8 million visitors last year but after a second round of financial restructuring, it remains weighed down with e1.9 billion ($2.5 billion) debt. Earlier this month it posted a net loss for its fiscal year of $1.16 billion.
But on the basis of Center Tainment’s sketchy presentation, shares in EuroDisney looked positively blue chip by comparison.
Still Andreesen expressed optimism about the upcoming bid’s chances.
“I am confident that we will succeed in taking control of EuroDisney,” he said.