Letter to the Members of the Shareholders Club – Recapitalization project

Members of the Euro Disney S.C.A. Shareholders Club received the following communication from the company this morning regarding todays announcement of the recapitalization project.

 

Dear Shareholder,

The Shareholders Club informs you:

Letter to the Members of the Shareholders Club

Marne-la-Vallée, October 6, 2014

Euro Disney announced today a 1 billion euro recapitalization, backed by The Walt Disney Company (“TWDC”), aimed at significantly bolstering Euro Disney’s financial position and enabling it to continue investing in the destination, better positioning the company for long-term success.

Despite continued investment in the resort, challenging economic conditions in Europe have negatively impacted financial performance, and constrained Euro Disney Group’s ongoing ability to make investments while supporting its debt burden.

The contemplated transaction encompasses several components. First, there would be an injection of approximately 420 million euros via capital increases in Euro Disney S.C.A and its principal subsidiary. Second, there would be a significant reduction of the Group’s indebtedness through the conversion of 600 million euros of the debt owed to TWDC into equity of Euro Disney S.C.A. and its principal subsidiary. Lastly, there would be an improvement of the Group’s liquidity via the deferral of amortization of loans until final repayment in 2024.

As a Euro Disney S.C.A. shareholder, you would have the opportunity to participate in the capital increases of Euro Disney S.C.A, alongside our main Shareholder, TWDC, on equal financial terms:

  • You would have the opportunity to participate along with TWDC in a 351 million euro rights offering by Euro Disney S.C.A. at a subscription price of 1.00 euro per share; and
  • You would have the right to acquire your pro rata portion of the shares in Euro Disney S.C.A. subscribed to by TWDC through its conversion of debt at a price of 1.25 euro per share, i.e., the price paid by TWDC to subscribe such shares.

You would also have the option to sell your shares to TWDC after the completion of the capital increases of Euro Disney S .C.A. through a mandatory tender offer required by French law and regulations. The proposal is made by TWDC on the basis of a mandatory tender price of 1.25 euro per share.

A more detailed description of the Disney proposal and the conditions which must be met for it to be implemented can be found under “Details of the Proposal” of the press release.

If implemented, this operation would mark an important financial milestone for Euro Disney. This new financial foundation would enable us to pursue our investment strategy and better position the Resort for a potential return to growth in Europe.

As newly appointed Président of Euro Disney S.A.S., I am delighted to return to Disneyland® Paris after having been part of the Resort’s Grand Opening team in 1992 to lead the group in the implementation of its long-term development strategy. The management team and I are very excited about this transaction, and we sincerely hope you will continue to take an active role in this new era for Disneyland Paris.

 

Tom Wolber,

Président Euro Disney S.A.S.

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