CIAM slams Walt Disney as ‘Scrooges’.

Logo_Euro_Disney_SCA

Yesterdays Telegraph published an article about the legal action being taken by French hedge fund Charity & Investment Merger Arbitrage Fund (CIAM) against Euro Disney S.C.A. and The Walt Disney Company.

It appears that Anne-Sophie D’Andlau founder of CIMA was in London last week and spoke about the legal action CIAM is  taking against The Walt Disney Company in the French criminal courts for misuse of corporate assets, publication of inaccurate accounts and misleading information.

In the civil courts, CIAM is fighting for shareholders to be reimbursed for €930m of fees overpaid by Euro Disney. The company has also taken its case against Disney’s 2015 €1.25 Recapitalisation share offer to the Supreme Court.

This year Disneyland Pairs  posted a record  loss of €858 million, which included an impairment charge for the Group’s assets of €565 million.

We have been covering this story for quite some time, you can read the back ground to the case here.

Activist fund slams Walt Disney ‘Scrooges’

An activist investor has declared war on Walt Disney, vowing to claw back almost €1bn in “egregious fees” levelled against its struggling French offshoot.

French asset manager CIAM has accused the Mickey Mouse creator of crippling the spin-off Disneyland Paris theme park with grossly inflated costs in an effort to increase its 77pc stake on the cheap.

“Euro Disney’s roller coasters are nothing compared to the scary ride that its shareholders have been taken on,” said CIAM founder Anne-Sophie D’Andlau in London last week.

Walt Disney imposes fees on Euro Disney for using its animated characters, but the fund says the rates are at least three times standard market practice. The fund also accused Walt Disney of deliberately concealing the eye-watering value of Euro Disney’s extensive land rights in areas surrounding Paris in order to make a low-ball buyout offer of €1.25 a share as part of a €1bn restructuring launched in 2015.
The value of Euro Disney’s 2,200 hectares has been independently valued at upwards of €1.9bn or about €2.40 a share, making the park worth at least three times the Walt Disney offer, CIAM says.

“It seems as though Walt Disney has spent a bit too much time studying its own Scrooge McDuck cartoons,” she quipped.

In the civil courts, CIAM is fighting for shareholders to be reimbursed for €930m of fees overpaid by Euro Disney. The company has also taken its case against Disney’s €1.25 a share offer to the Supreme Court.

Walt Disney has previously dismissed the action as “utterly without merit”.

Euro Disney, the company which operates the resort, has never made a profit despite attracting 15m visitors a year, making it Europe’s biggest tourist destination, Ms D’Andlau said.

Instead, shares in the company have shed 99pc of their value since the company went public in 1989.

Ms D’Andlau claims this is because Walt Disney siphoned a total of €930m (£780m) out of the company through artificially high licensing and royalty fees over the past decade.

Walt Disney imposes fees on Euro Disney for using its animated characters, but the fund says the rates are at least three times standard market practice. The fund also accused Walt Disney of deliberately concealing the eye-watering value of Euro Disney’s extensive land rights in areas surrounding Paris in order to make a low-ball buyout offer of €1.25 a share as part of a €1bn restructuring launched in 2015.

The value of Euro Disney’s 2,200 hectares has been independently valued at upwards of €1.9bn or about €2.40 a share, making the park worth at least three times the Walt Disney offer, CIAM says.

“It seems as though Walt Disney has spent a bit too much time studying its own Scrooge McDuck cartoons,” she quipped.

The activist fund has launched a three-pronged legal assault on Walt Disney, taking the parent company to the French criminal courts for misuse of corporate assets, publication of inaccurate accounts and misleading information.

In the civil courts, CIAM is fighting for shareholders to be reimbursed for €930m of fees overpaid by Euro Disney. The company has also taken its case against Disney’s €1.25 a share offer to the Supreme Court.

Walt Disney has previously dismissed the action as “utterly without merit”.

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