April 28 (Reuters) - Walt Disney said on Monday it has struck a deal with its Chinese joint venture partner to increase investment in its upcoming resort and theme park, Shanghai Disney, by an additional $800 million.
The expansion comes with an eye on China’s fast-growing entertainment and media market, which is expected to grow to $148 billion by 2015 from around $120 billion in 2013, according to PricewaterhouseCoopers’ outlook for the global entertainment and media business 2011-2015.
The increased investment will be used primarily to fund additional attractions to increase capacity at the park, with most targeted to be completed for opening day, Disney said in a statement.
The owner of parks and resorts worldwide, including in cities like Tokyo and Paris, on its website says the Shanghai theme park and resort is slated for opening in late 2015.
The joint venture’s total investment in the theme park, touted as China’s answer to Orlando, will now total $5.5 billion after the increased investment, a Disney spokesman confirmed.
State-owned Shanghai Shendi will continue to hold 57 percent of the shares of the owner companies, while Disney said it will hold the remaining 43 percent.
Disney, which also operates a theme park in Hong Kong, signed an agreement in 2010 for its first theme park in mainland China. (r.reuters.com/vej88v)
Financing of the additional investment will be proportionate to ownership and third-party debt is not expected to pay for the expansion, Disney said.
Disney in February reported higher profit for the quarter that ended in December, beating Wall Street expectations due to growth at its sports network and the blockbuster animated hit film “Frozen.”
Higher guest spending in the United States also helped push up profit at Disney’s theme parks unit. (Reporting by Sampad Patnaik in Bangalore and Ronald Grover in Los Angeles; Editing by Cynthia Osterman)