FRUSTRATED HONG KONG
Creditors of the struggling Hong Kong Disneyland joint venture agreed to suspend the debt covenants of a $293 million commercial loan for a year and give owners Disney and the government of Hong Kong access to funds that had been frozen, Chief Financial Officer Tom Staggs said.
In exchange, the joint venture will repay the loan by Sept. 30, 2008
, and Disney will forgo royalties from the park for "a couple of years," Staggs said on a conference call.
Hong Kong Disneyland, which opened in 2005, missed its first-year attendance target of 5.6 million by nearly 10 percent and has not released second-year totals.
Hong Kong's commerce secretary, Frederick Ma, told the Standard newspaper this week that the government was now reconsidering its approach and may inject new funds to expand the park. But commerce officials declined comment.
"The agreement with the creditors is a good thing," said a spokesperson for the Hong Kong Tourism Board. "We hope the park and its management will be able to develop a more concrete plan to attract more visitors." (Additional reporting by Joseph Chaney in Hong Kong; Editing by Edwin Chan & Lincoln Feast)