André Lacroix: Restructuring Space Mountain: the boss who rides Disney's debt tower of terror

The chief executive of Euro Disney takes Jason Nissé for a spin while explaining how his company can get off its financial rollercoaster
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There is something about interviewing André Lacroix that makes you want to turn into Jeremy Paxman. In normal circumstances, the chairman and chief executive of Euro Disney is charming, intelligent and affable. He is willing to discuss anything from whether you should go on the new Space Mountain 2 ride at his company's Disneyland Paris theme park before or after lunch (the former) - to whether France should vote for the European constitution (it should).

There is something about interviewing André Lacroix that makes you want to turn into Jeremy Paxman. In normal circumstances, the chairman and chief executive of Euro Disney is charming, intelligent and affable. He is willing to discuss anything from whether you should go on the new Space Mountain 2 ride at his company's Disneyland Paris theme park before or after lunch (the former) - to whether France should vote for the European constitution (it should).

But as soon as you start a formal, on-the-record, interview, Lacroix becomes about as forthcoming as a cabinet minister on the Today programme. He starts spouting statistics and repeating "key messages" such as, "We are the number-one tourist attraction in Europe." You have to hold back the urge to interrupt him and ask the original question 14 times.

Maybe such evasiveness is down to the fact that Lacroix and Euro Disney have just emerged from a year-long financial restructuring - a process that involved corralling the often-differing interests of the Walt Disney Company, Prince Alwaleed bin Talal of Saudi Arabia, a group of international bankers and a large number of, mainly French, small shareholders. It was the second financial restructuring in Euro Disney's short life and was dumped on the 45-year-old Frenchman's lap within a few months of his being headhunted from Burger King to run the company in July 2003.

Euro Disney's history has not been happy, partially because of the decision by Michael Eisner, the head of Walt Disney, to float the French theme park on the Paris stock exchange. This created a natural tension between Walt Disney - which today owns 40 per cent of the group and is entitled to up to 6 per cent of its revenues as royalties - and its European subsidiary.

Only a few months after the theme park's opening, in 1992, Euro Disney was in financial trouble and had to strike a deal with its banks. Having been dragged out of the mire once, it plunged back into it around 10 years later - courtesy of the decision to build a second theme park in Paris, Walt Disney Studios, which opened just as the 9/11 terrorist attacks undermined world tourism.

With €2.4bn (£1.6bn) of debts and no sign of profits, Lacroix and his finance director, Jeff Speed, spent most of 2004 saving Euro Disney. At times, the battles became fractious and threatened the future of the company. In the end, Walt Disney converted the €300m it was owed into shares and agreed to defer €25m of royalty payments a year for eight years. Meanwhile, the banks converted most of their debt into long-term deals at good rates, and investors, led by Prince Alwaleed, stumped up €250m of new money.

With the final deal completed at the end of March, and Euro Disney publishing encouraging first-half figures last week that showed net losses falling from €108.9m to €80.9m, Lacroix is at last able to break cover.

"It was a very important restructuring," he says. "It not only addressed the liquidity issues but it provided the financing we need to invest in growth and new attractions."

And invest is just what the company is doing. Starting this year, it is ploughing €240m into a whole new set of rides and events that Lacroix hopes will cement Disneyland Paris and Walt Disney Studios as - yes - "the number-one tourist attraction in Europe". Last month the first new ride for four years, Space Mountain 2, opened to great acclaim. Next year Buzz Lightyear Laser Blast, based on the Toy Story character, will be unveiled. In 2007 and 2008 there will be attractions aimed at improving the poorly received Walt Disney Studios: a cartoon-based show called Toon Studio, and a version of the successful US ride, Tower of Terror. On top of this, Lacroix has put a lot of work into special events to bring in tourists in the traditionally slow winter months - offering five different "seasons" with parades and firework shows.

"We have room to grow and provide more high-quality family entertainment," says Lacroix. "My role is to grow the resort."

Much of his work is aimed at getting people to come to Euro Disney for the first time. Some 12.4 million people visited the theme parks last year, but only a third of these were on their first trip. And not enough people were staying at the resort hotels - which boast 8,000 rooms - and not enough visitors to Disneyland Paris were going to Walt Disney Studios as well.

Initiatives have included cutting the room rates at Euro Disney's hotels, offering cheap deals for day-trippers to visit both parks, and building on the resort's bizarre success as a convention centre - the fifth-most popular in France. Despite this fillip, Lacroix admits: "It is going to take us several years to get back into financial profitability."

But why should Europe's "number-one tourist attraction" do so badly financially? After all, the other Disney theme parks - in California, Florida and Japan - are highly profitable, and Walt Disney has just opened a new one in Hong Kong, of which it has high hopes.

"In the US, Disney theme parks are a big, well-established market," argues Lacroix. "In Europe, in 13 years, we are developing a new concept."

When Eisner was in London recently, he suggested the fundamental problem was that Disneyland Paris had cost too much to build. Would Lacroix agree with that verdict? "I wasn't at that meeting and I wasn't here at the time [the park was built]," he shrugs.

Some investors worry that the relationship with Walt Disney might inhibit Euro Disney. For example, the park is resolutely bilingual - which is reflected in the statistics showing that, after the French (40 per cent of guests), Brits make up the largest visitor group (19 per cent). But a report recently criticised the park for not catering well enough for Germans, Spaniards and Italians.

Lacroix dismisses this, saying that the Walt Disney company has been very supportive. He admits there are cultural issues that sometimes come up, but counters: "We obviously are Disney, and the Disneyland brand is an American brand. Most of our attractions are ones that are in the US, but there are some that are not."

To a great deal of satisfaction within the Euro Disney team, an attraction made in Europe is being exported to the US for the first time. Motoraction, a live car stunt show developed for Walt Disney Studios by French film experts, is being launched at Disneyworld in Florida.

It is quite a coup for the "number-one tourist attraction in Europe".

BIOGRAPHY

Age: 45.

Education: MBA from the Ecole de Commerce de Paris, 1983.

Career (1983-85): Ernst & Young, West Africa.

1985-88: Colgate-Palmolive, France and Germany.

1988-96: Pepsico: international marketing manager, 7UP; international marketing director, Middle East and Africa; sales operations director, East Germany; general manager, Holland, Austria, Belgium and Switzerland.

1996-2003: Burger King: general manager, Germany and northern Europe; president, Europe, Middle East and Africa; president, Burger King International.

2003 to now: Euro Disney: chairman and chief executive.

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