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Orrick Advises Euro Disney Supervisory Board on €1.33 Billion Debt Refinancing

10-17-2012

Paris - Orrick recently advised Euro Disney's supervisory board on the refinancing of €1.33 billion of debt. Euro Disney operates Disneyland Paris, Europe's most popular tourist attraction, which employs over 14,500 cast members and has drawn 250 million visitors since 1992.

The Walt Disney Company ("Disney") holds a 40 percent equity stake in Euro Disney, a listed company on the NYSE Euronext, and an 18 percent equity stake in the company that is operating Disneyland Paris parks and hotels. By virtue of the company's by-laws, Disney controls the management of Euro Disney and the management of the parks and hotels operating company.

Prior to the refinancing, the Euro Disney project had a complex structure, which reflected the different financial phases and the result of restructurings that took place in 1994 and 2005. Under the previous financing, Euro Disney had to respect certain commitments towards its lenders, particularly concerning debt and investment restrictions, communication of figures and financial ratios.

Under the new refinancing, Disney has loaned €1.23 billion to Euro Disney, in addition to a revolving credit facility of €100 million, which will run until 2017. The loan, carrying an interest rate of 4% - compared with the average of 5.1% that Euro Disney currently pays - will cut its interest costs by €45 million over the next five years. Furthermore, the new financing will allow the operating company of Disneyland Paris to end the complex financial structure that was set up under its leasing agreement and will allow it to recover ownership of the parks and hotels.

A cross-practice team consisting of Paris M&A and private equity partner Jean-Pierre Martel, Paris capital markets partner Alexis Marraud de Grottes and Paris tax partner Anne-Sophie Kerfant advised the Euro Disney supervisory board on this highly complex transaction.

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