Euro Disney tries to capture the magic

PARIS — Disneyland Paris may be Europe’s most visited tourist attraction, but its operator Euro Disney SCA still has work to do to make the Disney theme park concept profitable on this side of the Atlantic.

Euro Disney boss Andre Lacroix is hoping the 253 million euro ($328 million) capital increase announced Friday will help to spark a turnaround at the company, amid signs that the tourism industry is emerging from three years of gloom.

Most of the cash will be spent on four new attractions designed to bring more visitors to the Disneyland and Walt Disney Studios parks outside Paris, spokesman Pieter Boterman said, starting with Space Mountain Mission Two in April this year — a revamp of the 10-year-old ride. The Buzz Lightyear Astro Blast, based on the Toy Story movies, and two others will follow by 2008.

Announcing the Disneyland park’s first launches for several years, CEO Lacroix said last week that the new attractions were “important to drive attendance.”

Visitor numbers peaked at 13.5 million in 2002. Last year, the parks drew 12.4 million visitors — twice the number that climbed the Eiffel tower, but still not enough to pull Euro Disney out of the red.

Euro Disney set a goal of 16 million annual visitors when it opened the Walt Disney Studios park in 2002. It “stopped using” that target when market conditions deteriorated, Boterman said, declining to say what attendance objectives had replaced it.

“We need to grow the attendance but it’s important to note as well that attendance is not the only indicator we have to work on,” he said, citing efforts to increase visitor spending and occupancy rates at the Disneyland Village hotels that account for 40 percent of the company’s revenue.

The rights issue, which runs from Jan. 31 to Feb. 8, is part of a 1.7 billion euros ($2.2 billion) rescue package approved by shareholders in December.

The package includes 1 billion euros ($1.3 billion) debt deferrals by parent company Walt Disney Co., French state-owned bank CDC and other creditors. Walt Disney also provided a new 150 million euro ($194 million) credit line and agreed to swap 300 million euros ($390 million) in leasing payments due next year for an 18 percent equity stake in Euro Disney’s main assets.

Walt Disney has agreed to subscribe to 100 million euros ($130 million) in Euro Disney stock at 9 euro cents (12 cents) per share as part of the rights issue, maintaining its 40 percent stake in its subsidiary.

Saudi Prince Alwaleed Bin Talal, the other major shareholder, will invest 19.6 million euros ($25.3 million).