Originally Posted By Bolna << While some want to price them closer to $20 billion rather than $10 billion, I have been told a valuation of $12-13 billion (from a Wall Street type) is a best case scenario if TWDC is looking to drop the unit entirely from its portfolio.>> Thanks, I had asked about the value before and interestingly those $12-13 billion were the exact numbers someone else mentioned as well... That seems to be a deal of a substantial size, but still considerably smaller than the really large deals. Still the question remains: What do they want to do with the cash - they would have to invest it somehow. Most likely go out and buy new divisions. Is there anything out there they might want to get which would fit the image of a "distribution company"? <<The Disney P&R division, contrary to what many WDW-centric fans would have you believe, is dwarfed in its value to TWDC by its cable holdings.>> Yes, I was rather surprised when this topic made me look at numbers: according to wikipedia in 2010 only 17% of the net income of TWDC was from P&R, while Disney Media Network produced 67% of the net income. No surprise that these numbers make some people question whether WDP&R is still a good fit considering that it is so cost intensive. <<It does mean Disney's P&R Division IS on the block. They want to sell, and this has to concern all fans. Again, because if you are looking to sell something, you're only going to minimally invest in it.>> I agree, the scenario of WDP&R being on the market indefinitely is much more scary than it being sold off. A new investor is much more likely to care for long-term quality than someone who rather wants to get rid of it.
Originally Posted By dshyates "I agree, the scenario of WDP&R being on the market indefinitely is much more scary than it being sold off. A new investor is much more likely to care for long-term quality than someone who rather wants to get rid of it." All one need to do is look at the attendance hit URO took during the 5 years GE/NBC were trying to sell the Uni. parks. They didn't add anything and let maintenance slide badly. They numbers went from 9M to 5M in those 5 years. Even with Potter they are not back to where they were in 2000. Let's all hope for a speedy decision either way.
Originally Posted By leemac << While some want to price them closer to $20 billion rather than $10 billion, I have been told a valuation of $12-13 billion (from a Wall Street type) is a best case scenario if TWDC is looking to drop the unit entirely from its portfolio.>> No idea who this Wall Street type is but I can assure you that WDP&R would never be sold for c.$12-13bn. That implies that it is only 15% of the value of the company as a whole (which is currently trading up near $40 per share for a market cap of c.$81bn). TWDC doesn't use EBITDA as a non-GAAP measure so it isn't the easiest calc to come to in terms of value determination. That said: 2010 Op Income was $1,318m (17.4% of the group) Add back depreciation of $1,139m Then you need to get to the interest and tax charges for the division which aren't shown separately. If you take 15% of both you'd get to c.$400m (I'd estimate that a huge chunk of the $409 group net interest expense related to WDP&R whilst it probably doesn't pay a lot of taxes due to the high taxable expenses). That gets you to an EBITDA of c.$2.9bn. On a 8x multiple that would get you to $23bn before equity deductions for debt etc. Therefore I'd wager that any offer would need to be north of $25bn to even be considered. I'd go further and say that only a number beginning with a 3 would warrant even a discussion.
Originally Posted By EPCOT Explorer >>>Assuming TWDC is going to sell WD P&R, would they keep WDI? I can imagine that Disney still wants to be in control what's going to be built at Disney Parks. <<< I'd think so... it might be like how TDR is run. ...which gives WDI a lot more freedom, I think. Someone else is paying the bill. I think we'd benefit from that, if anything.
Originally Posted By EPCOT Explorer >>>I am not sure about how things work in the US, but here in Germany a public company would be required to publish certain information which would influence the share price within a certain amount of time to avoid insider trading. You can't just go around and hint at stuff. Either it is still not decided and therefore not made public, but once a decision is reached, it needs to be out in the public. And selling a division of your company (or part of that division) definitely would be something that can affect share prices.<<<< I don't think we have that. lol
Originally Posted By leemac <<I don't think we have that. lol>> Oh yes we do - the SEC mandates full disclosure for listed companies.
Originally Posted By leemac Edgar is the online database of SEC filings - link to DIS below: <a href="http://tinyurl.com/3ggsghh" target="_blank">http://tinyurl.com/3ggsghh</a> Sadly there is a huge amount of boilerplate required for these filings and Edgar isn't the most user-friendly interface. Basically an 8-K is the general form used for any material event - usually a press release etc. Form 10-Ks relate to financial information releases such as quarterly reports and annual reports.
Originally Posted By vbdad55 And where's all this in WDW? ---- let me ask you this EE-- what was your opinion of the parks this past trip ? Mine was there was some improvement in overall cleanliness and housekeeping. There are still the attraction issues we all talk about here...but I thought for my part- the food was very very good ( I did not eat at any counter service other than Dole Floats so can't comment on that) - thought SM'd were very pleasant this trip...trams were plentiful and well run. Thought light show on castle before wishes really cool- enjoyed it a lot. And in EPCOT more street entertainment then last year which was more than the year before. I consider those all positive items..it is time however to take some risk ( I am glad to see others here saying DIsney is a business )- and invest in not only something else new- but upgrades of some of what we have. I had little complaint in that direction- but I do agree the focus needs to go to the attractions and now.
Originally Posted By davewasbaloo Glad to hear of the improvements vbdad, though to be fair, my concerns have been business motivated. For long term patronage the quality facet should be the sacred cow.
Originally Posted By EPCOT Explorer >>>let me ask you this EE-- what was your opinion of the parks this past trip ? Mine was there was some improvement in overall cleanliness and housekeeping. There are still the attraction issues we all talk about here...but I thought for my part- the food was very very good ( I did not eat at any counter service other than Dole Floats so can't comment on that) - thought SM'd were very pleasant this trip...trams were plentiful and well run. Thought light show on castle before wishes really cool- enjoyed it a lot. And in EPCOT more street entertainment then last year which was more than the year before.<<<< I posted a TR when I got back, but to summarize: While I always think that Disney is the leader in providing a world class destination and environment.... ....it is very apparent that when looking at the parks without the guise of it being special by just existing... the parks are very, very stale. The newest thing I saw on my trip was a queue and a light show.. Which, the former, I didn't like. Maint. looked the best it's looked in quite a while in some regards, others, not. That shouldn't be a part of my opinion of WDW in the first place, it should always look great. Show quality, however were large problems on some rides, like CoP and Splash. Really bad stuff, too. AA's not moving at all and slumped over, drained of hydraulics. The rampant synergy always bothers me, especially when it goes beyond just the rides it exists in. It seems that EVERY time I was on Main Street, the Celebrate Mini Parade was BLASTING, totally destroying any of the place making and mood and ambiance that a THEMED ENVIRONMENT is supposed to have. It wasn't until late afternoon that I could really bask in the atmosphere. That bothered me to no end. But on the plus side... I'm getting to a point now, with Disney, that though I prefer some parks over others (MK and EPCOT), when in there, I still want to ride things, but it isn't with rigidity that I might have been conducting myself with in past years. If I miss HoP or Buzz...it's not that bad. And in that, I've done other things. Took some time to get to see Adventureland, the Tree House, the train. In doing smaller things, the design choices and texture of WDW and the MK is still very much there, alive and well. That's something that I really realized on this pst trip. ... If anything, the upkeep and use of these attractions still facilitates my belief that Disney is a special place. ...A special place that's flawed. They need to keep those old vestiges of quality, of theme, and of texture, and use them to build up to new attractions and new venues that reflect creativity on NEW things. Not the old, like with the Mansion queue. Or the typical Disney archetype like with the light show or mini parade. Disney will always be Disney if they keep that texture and heart of the parks. But they can quickly loose it of they don't build around it.
Originally Posted By EPCOT Explorer Oh, you mentioned food, which I forgot to touch upon... Didn't do anything too new, save for what I ordered at Mexico- they changed their menu. Got chicken, it was very different from what I expected, but I REALLY enjoyed it. A lot. I've been craving it since. LOL. And we ate at the Plaza, which ALWAYS impresses. Nothing classier than that ambiance and a window view of Cinderella Castle at twilight. Damn, now I'm craving that too! LOL
Originally Posted By NukkelHead People Republic of the Red Chinese government could afford to buy the parks and do 12 times better job at running them. Red China already owns us anyway so what is the difference? Besides maybe Red China pavilion of Epcot will finally get a Great Wall Attraction instead of a boring movie and sell us delicious scorpions on a stick. Your Bo
Originally Posted By vbdad55 It seems that EVERY time I was on Main Street, the Celebrate Mini Parade was BLASTING, totally destroying any of the place making and mood and ambiance that a THEMED ENVIRONMENT is supposed to have ---- although some people seemed to be enjoying this-- I like you- did not care for it either
Originally Posted By EPCOT Explorer >>>although some people seemed to be enjoying this-- I like you- did not care for it either<<<< I would have liked it if I saw it once, and at about half the decibel it had. LOL
Originally Posted By skinnerbox <<I believe it is Dave>> I believe it's the same troll who's been creating a continual stream of sock puppets that mainly post in WE. He's a banned poster who went by name of 'Beau.' Get it? Beau vs Bo. Oh so clever. Not.
Originally Posted By TP2000 Not sure how it plays into the discussion here (which is fascinating!), but Al Lutz has a blurb up today about an executive restructure coming soon that is rumored to give Disneyland more "autonomy" from Florida. Obviously something is up, but I still just can't get my mind around DisCo selling off the parks division to an Arab sheik or Warren Buffet or Beijing or anyone really.
Originally Posted By Manfried Okay, these things bear repeating. One, the parks should be kept up. Two, if you go everyday, they're not going to look as good. You are too close to them. Three, take a trip to something other than Disney for a while.
