Japanese banks unhappy with Euro Disney rescue

WALT DISNEY'S Euro Disney rescue plan has run into trouble barely three weeks after getting the agreement of a steering committee drawn from the 63 banks that have lent to the beleaguered Paris theme park, writes Gail Counsell.

Up to 20 Japanese banks are opposing the deal, which involves a Fr6bn ( pounds 700m) rights issue, the waiver for five years of Walt Disney's estimated Fr450m-a-year royalties, the injection by Walt Disney of Fr1.4bn through a ride-leasing deal, and the writing off of more than half the theme park's Fr20.3bn debts.

But one dissident banker yesterday told the Reuter news agency in Paris that the Japanese had been told by their head offices not to approve the deal in its present form.

He said non-Japanese banks were also bothered by the terms. Their objections centre on the desire to force banks that lent on subordinated terms to play a bigger role. They want junior lenders, such as French state-owned Caisse des Depots et Consignations, to take a greater part in underwriting the half of the rights issue not taken up by Walt Disney.

The steering committee said the objections were inevitable in a complex restructuring. But BNP and Indosuez, the French banks leading the negotiations, have invited the Japanese to talks in Paris on Monday to try to change their minds. They have set an informal 15 April deadline for agreement.