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[Kristof]

PARIS, Nov 29 (Reuters) - French theme park operator Euro Disney is aware of a report that it was about to receive a hostile takeover bid but said it had not been approached, amid reports of a pending offer by a little-known Swiss firm.

"We are aware of the rumour that this company is organising a press conference in Paris tomorrow to present a bid, but we can't say more. We have not been approached," said a spokesman for Euro Disney on Wednesday .

He was responding to an article in Le Monde newspaper which said Zug, Switzerland-based and Frankfurt-listed Center-Tainment AG (G6P.DE: Quote, Profile, Research) was poised to make a bid for the operator of Disneyland Paris.

Center-Tainment said last week it would hold a news conference on Nov. 30 to announce an unspecified takeover.

Center-Tainment did not immediately respond to an e-mail seeking comment on Wednesday.

Heavily indebted Euro Disney is 39.8 percent owned by Walt Disney Co. (DIS.N: Quote, Profile, Research) via its 100 percent subsidiary EDL Holding, and 10 percent indirectly owned by Saudi prince Alwaleed.

The loss-making company's banks have a large say in its future, however, through conditions they have set in return for providing the firm with debt financing.

Euro Disney has a market capitalisation of 272.84 million euros, with its net debt of 1.67 billion euros at Sept. 30 giving an enterprise value close to 2 billion euros.

Its shares trade at 7 euro cents after a 36 percent decline this year and a 54 percent fall over 2005.

Center-Tainment chairman Ulf Werner said in a statement last week that the target company was itself listed and therefore resistance by management and some shareholders could be expected.

Werner said that movements in the Center-Tainment share price gave rise to suspicion that some parties had taken short positions to make a Center-Tainment bid less attractive.

"The target company has, as is proper procedure, already been informed about Center-Tainment's strategy," the firm said, adding the target firm's investment bank had contacted the company and was preparing a defence.

Center-Tainment said that it expected a risk-free gain in double-digit millions if its five-year plan for the target firm was executed and it said it was confident it could finalise the acquisition in 2006.

Center-Tainment is a holding company of family entertainment firms that are active in outdoor and indoor activities. Its Web site lists Jack Kaeser and Hermann Wattenhofer as other executives.

At the start of November, Euro Disney said a new Buzz Lightyear ride helped it boost visitor numbers and trim its fiscal 2006 year loss and it was confident it could keep afloat in 2007.

The company, which has to meet certain financial targets to stop banks from calling in its debts, said its net loss narrowed to 73.1 million euros from a comparable loss of 92 million euros in 2005.

The operating loss excluding debt-servicing costs narrowed to 2.4 million euros from 31.9 million as revenues grew faster than costs. It said it planned a series of special events around its 15th anniversary and new additions to its Walt Disney Studios Park.

Source: Reuters

[penfold12]

I dont know the business logistics of this fully, but I assume thi smeans they are making a take over bid ofr the Euro Disney SCA owned share of the resort, and could not touch the Walt Disney and Prince share?

If this is the case, I would assume that all current rules, regarding operation standards and brand identity including copyright etc would remain the same.

May be total wrong here, but if it is like a lot of other take overs, ultimatley everything remains the same with only the owners name changing?

But with debts being paid off?

[Samninetysix]

Penfold, that's how I see it - new owners, same operation. Look at whats happened at Manchester United - £790m takeover but it's business as usual - new owners dont mean bad things

[penfold12]

You never know, it may even be a good move for the resort, with an injection of cash.....

[Samninetysix]

Very tru, and if the offer per share is good and walts mates think it's good business, then maybe we will get a cash injection!! and lets face it, we could probably do with a disney rooney!

[Anthony]

This is a strange story.  I would never have expected someone wanting to buy out Euro Disney SCA! :lol:

penfold, I think you're right about how it would work, they'd probably just take ownership of Euro Disney somehow and then perhaps enjoy the rewards in many (many many many) years time.  I'm not sure what would happen with the debt though.

I guess we'll just have to wait and see if anything happens tomorrow. It might turn out to be nothing.  Seems more like whispers in the playground rather than big business dealings.

[Tron 2.0]

I'm not sure what would happen with the debt though.

They would assume all of the company's debt.

--Mark

[anthony2k6]

Who knows what they'd do. Reports say they'd own over 50%, in which case I assume they could do anything they wanted - including rename and remove all traces of disney from it

[Patrick]

They could never remove Disney from the park as long as Disney is part holder, the Walt Disney Company own a stake in the resort and so anything that happens also has to go through them, the company would not be buying Disney's share but EuroDisney's which is a completely different company.  As for why anyone would ever want to buy out EuroDisney is a complete confusion to me, after all they're in so much debt anyway :? .

Sure in a few many years they may make profit, but it stills makes absolutely no sense at all, it is hardly like EuroDisney are failing completely and at the brink of closure or anything.

[anthony2k6]

They could never remove Disney from the park as long as Disney is part holder, the Walt Disney Company own a stake in the resort and so anything that happens also has to go through them, the company would not be buying Disney's share but EuroDisney's which is a completely different company.  As for why anyone would ever want to buy out EuroDisney is a complete confusion to me, after all they're in so much debt anyway :? .

Sure in a few many years they may make profit, but it stills makes absolutely no sense at all, it is hardly like EuroDisney are failing completely and at the brink of closure or anything.

but Disney only own 39% apparently, so would be overuled if this other company has over 50%. Majority share would rule surely?

[Kristof]

More news:

PARIS (MarketWatch) -- Center-Tainment AG (G5N.XE), a Swiss-based leisure company, is planning to launch a takeover bid for French theme-park operator EuroDisney (12587.FR), French weekly business magazine Challenges said Wednesday on its Web site.
A spokesman for EuroDisney said he wasn't aware of any such offer from Center-Tainment, which is listed in Frankfurt.
EuroDisney is 40% owned by Walt Disney Co (DIS) through its wholly-owned EDL Holding subsidiary, while Saudi Prince Al-Waleed bin Talal bin Abdul Aziz Al-Saud has an indirect 10% stake.
Center-Tainment, based in the Swiss tax haven of Zug, has called a press conference Thursday in a Paris hotel to unveil its bid, according to the magazine's web site.
The report added that Center-Tainment is going to offer its own shares that will value EuroDisney shares at EUR0.11 a share.
Center-Tainment has been listed on the Frankfurt stock exchange since September.
Shares in heavily indebted EuroDisney were trading at EUR0.08 on the Paris Bourse mid-afternoon, up 14% from Tuesday's close.
A press release purporting to come from Center-Tainment, and received by Dow Jones Newswires, said the company was created with the sole purpose of launching a takeover bid for EuroDisney.
The release, inviting journalists to Thursday's press conference, said Center-Tainment is being advised by "very experienced and influential managers of the leisure industry," but didn't elaborate.
The release said Center-Tainment is seeking to control at least 50.01% of EuroDisney's shares.
No-one was answering the German phone number given in the invitation, and only an e-mail return of address was given.
The release said that Center-Tainment "expects very hard resistance" from EuroDisney's management and from its main shareholder; the company pledged to put its own management team in charge of EuroDisney if the bid is successful.
The release also said Center-Tainment is engaged in negotiations with other potential, though smaller targets in the European leisure business.
To be successful, a takeover bid for EuroDisney would have to be approved by U.S. Walt Disney Co. because of EuroDisney's legal status as a partnership by shares.

Source here.

[anthony2k6]

clicky

This reuters seems to paint a different picture

Center-Tainment CEO Ulf Werner, 60, told reporters the aim of the bid was to gain management control and renegotiate the operating licence agreement with Walt Disney Co (DIS.N: Quote, Profile, Research).

Andreesen said it would act without Disney if necessary

 :?

[Kristof]

I'm told that there is a clause in the Euro Disney contracts that nothing can ever be changed without the approval of Disney.

[Kristof]

Another article by Forbes:

PARIS (AFX) - The chequered history of theme park operator Euro Disney SCA took a twist as dramatic as anything in a Mickey Mouse cartoon when a little-known Swiss company announced plans for a takeover bid.

The Disneyland Paris resort claims to be Europe's most popular tourist attraction with 12.8 mln visitors in its year to September, but it remains loss-making and still has 1.9 bln eur in debt after a financial restructuring last year.

Ulf Werner, chairman of Center-Tainment AG, said his Zug-based business will launch a bid in coming days' and he will notify Paris bourse regulator AMF today of his intentions.

The proposal will be an all-share offer for Euro Disney's free floating stock, aimed at giving Center-Tainment a 50.01 pct stake, Werner said at a news conference here.

The proposed terms of Center-Tainment shares worth 11 euro cents per Euro Disney share mean it could cost Werner's group as little as 200 mln eur to buy up half of the target company's stock.

At 2.08 pm, Euro Disney shares were steady at 0.09 eur, giving the owner of the Disneyland Paris resort a market value of 350.8 mln eur.

Werner said his aim is to make Euro Disney profitable, so that shareholders benefit from the results rather than just paying off debt and interest.

Kurt Andreesen, described as a consultant to Center-Tainment, said the company wants to negotiate a new contract with Walt Disney. He said he spoke yesterday to Karl Holz, Euro Disney's chairman, to invite him to today's news conference.

The consultant said he is convinced Center-Tainment will reach its 50.01 pct target, adding that it has investors behind it who have enough money to finance its plans.

Andreesen said Center-Tainment is trading at 13 eur per share, down from 34 a few days ago. With 10 mln shares in issue, it has a market value of 130 mln eur, he said.

The company has '45 or 46' shareholders, with the core investor being a German company, Werner said, without revealing its name.

Euro Disney is 39.8 pct owned by The Walt Disney Co, while Prince Alwaleed bin Talal of Saudi Arabia has a 10 pct stake. Asked whether Center-Tainment has Arab investors, Werner said it is 'possible'.

Based in Zug, Switzerland and listed on the Frankfurt stock market, Center-Tainment was formed 'with the sole aim of creating a company able to initiate a share swap offer for Euro Disney's floating capital,' it said in a statement yesterday.

Euro Disney said it had not been able to obtain any details of the supposedly forthcoming takeover bid, despite requests to the company following press reports about the intended offer.

Euro Disney posted a net loss of 73.1 mln eur in its latest year, although new rides such as Buzz Lightyear Laser Blast brought in more visitors and helped group sales to grow 4.5 pct to 1.088 bln eur.

The group has been forced to restructure its finances twice since being launched in the early 1990s, and it completed a 253.3-mln eur capital increase in Feb 2005 to avert insolvency.

The rights issue was undertaken after agreement was reached with Walt Disney and creditor banks to restructure and cut the group's debt from 2.4 bln eur to 1.9 bln.

Source: Forbes

[DisneyBud]

I must say, I have never really taken note of this side of things about DLRP but I'm finding it really interesting, takes a bit of an effort to get my head round it all, but I think I'm there lol.  I guess there hasn't been any bid made today, does anyone know when it's likely to happen?