Disney expands to Shanghai, but will it also hook Shamu?
Filed under: Real Estate, Travel, Recession
But it could be even higher. That's because it's one of the potential bidders for SeaWorld and Busch Gardens, which are being unloaded by their new Belgian owner, InBev. A few weeks ago, Busch Entertainment, which owns the parks, announced it would no longer serve free beer, a longstanding tradition. Many financial observers thought the company made that particularly deluded move this month to make the parks more attractive to a buyer, who wouldn't have to endure the bad P.R. of axing the popular tradition later on.
The Wonderful World of Disney
Walt Disney Company Chief Executive Robert Iger and wife Willow Bay arrive at The Huffington Post Pre-Inaugural Ball in Washington January 19, 2009. REUTERS/Mitch Dumke (UNITED STATES)
Reuters
A farmer fertilizes a field in Chuansha town, where the first Disneyland on the Chinese mainland will be built, in Pudong District of Shanghai January 19, 2009. Shanghai Mayor Han Zheng said that Shanghai and Walt Disney Co. had reached basic agreement on the major issues on construction of a Disneyland theme park in Shanghai, although authority for approval of the project rests with the central government, according to local media. Picture taken January 19, 2009. REUTERS/Stringer (CHINA). CHINA OUT. NO COMMERCIAL OR EDITORIAL SALES IN CHINA.
Reuters
A boy rows a makeshift boat in front of his temporary house in Chuansha town, where the first Disneyland on the Chinese mainland will be built, in Pudong District of Shanghai January 19, 2009. Shanghai Mayor Han Zheng said that Shanghai and Walt Disney Co. had reached basic agreement on the major issues on construction of a Disneyland theme park in Shanghai, although authority for approval of the project rests with the central government, according to local media. Picture taken January 19, 2009. REUTERS/Stringer (CHINA). CHINA OUT. NO COMMERCIAL OR EDITORIAL SALES IN CHINA.
Reuters
Artists from mainland China perform at Hong Kong Disneyland January 15, 2009. Walt Disney Co. intends to submit a plan for a Shanghai theme park, which would be its second resort in China, to Chinese government officials, the company said last week. REUTERS/Bobby Yip (CHINA)
Reuters
An installation is displayed at Hong Kong Disneyland January 15, 2009. Walt Disney Co. intends to submit a plan for a Shanghai theme park, which would be its second resort in China, to Chinese government officials, the company said last week. REUTERS/Bobby Yip (CHINA)
Reuters
Artists from mainland China perform at Hong Kong Disneyland January 15, 2009. Walt Disney Co. intends to submit a plan for a Shanghai theme park, which would be its second resort in China, to Chinese government officials, the company said last week. REUTERS/Bobby Yip (CHINA)
Reuters
Mainland Chinese visitors watch a parade at Hong Kong Disneyland January 15, 2009. Walt Disney Co. intends to submit a plan for a Shanghai theme park, which would be its second resort in China, to Chinese government officials, the company said last week. REUTERS/Bobby Yip (CHINA)
Reuters
Characters at Hong Kong Disneyland pose after a parade celebrating the upcoming Year of the Ox January 15, 2009. Walt Disney Co. intends to submit a plan for a Shanghai theme park, which would be its second resort in China, to Chinese government officials, the company said last week. Chinese people all over the world will usher in the Lunar New Year on January 26. REUTERS/Bobby Yip (CHINA)
Reuters
Characters at Hong Kong Disneyland greet visitors after a parade celebrating the upcoming Year of the Ox January 15, 2009. Walt Disney Co intends to submit a plan for a Shanghai theme park, which would be its second resort in China, to Chinese government officials, the company said last week. Chinese people all over the world will usher in the Lunar New Year on January 26. REUTERS/Bobby Yip (CHINA)
Reuters
Characters at Hong Kong Disneyland pose after a parade celebrating the upcoming Year of the Ox January 15, 2009. Walt Disney Co. intends to submit a plan for a Shanghai theme park, which would be its second resort in China, to Chinese government officials, the company said last week. Chinese people all over the world will usher in the Lunar New Year on January 26. REUTERS/Bobby Yip (CHINA)
Reuters
Back in August, the scuttlebutt was that Busch was starting a rumor that Disney wanted to buy the parks merely as a ruse to inflate the price in a bidding war. But this week, the Financial Times reported that, indeed, Disney is very possibly in the running. So is Universal (which owns two parks in Orlando), but the fiercest competition will probably come from the company that owns Parques Reunidos, a Madrid-based operator of many parks in Europe. Parques Reunidos has a history of buying up all-American properties. It recently purchased the classic Pittsburgh park Kennywood, once of the country's most historic theme parks.
There's a pretty good chance that Disney won't hook Shamu for its theme park empire. First of all, the company has never gobbled up other parks before, not even as passive partners. It's also hard to imagine SeaWorld's straightforward marine enclosures and Busch Gardens' raw coaster thrills being re-branded with Disney's highly stage-managed panache. Six Flags is a more likely contender, and it's also tipped to be a possible bidder, but the 20-park group isn't on the steadiest financial footing these days. Or maybe a few of Disney's competitors will get together to gang up on Walt & Co.
Then again, Disney is one of the only companies big enough to be able to afford the price tag (up to $4.5 billion) of a theme park collection as large and as well-established as Anheuser-Busch's, and the Mouse is famous for being aggressive in doing whatever it can to choke competition wherever it operates. After all, this is the company that rushed its Hollywood Studios to market in order to head off Universal's Florida endeavors, and then built Animal Kingdom in part to compete against SeaWorld and Busch Gardens' animal offerings. But that was the '80s and the '90s. Modern Disney, quaking in its glass slippers over the shrinking economy, may not have the chutzpah to expand.
What would a Disney purchase of SeaWorld and Busch Gardens mean to devotees of Orlando and Anaheim? Hard to say. Having a monopoly may not translate into higher pricing; it would be tough to bleed consumers for more money than $80 for a single day's ticket, which is what Disney does now. Then again, aggressive multiplication by Disney could turn out to be a turning point in amusement parks as an American pastime. It worked for coffee and for hamburgers. Could we be seeing the beginning of a McDisney?
Reader Comments (Page 1 of 1)
1-20-2009 @ 8:55PM
Brooke said...
Would the company that buys Busch Gardens and Sea World also buy Busch's other parks, such as Adventure Islands in Tampa?
Reply
1-20-2009 @ 10:50PM
Dillon said...
I don't see why they wouldn't. Disney has the capital, InBev needs the capital. While I for one don't plan on seeing Shamu wearing a pair of mouse ears, I think they could inject a little Disney charm into some parks and traditions that badly need it.
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1-25-2009 @ 11:14AM
Jack said...
Disney is a company of tradition. when walt began it he wanted things run his way, i dont see how it would be keeping with disney tradition by letting these new properties operate as they have been, as well i don't think it would be cost effective to implement the mickey way of doing things at these other parks. disney parks are run like a theatre, with every employee a cast member, everyone has a role and specific dialog they are required to use with each customer.
1-20-2009 @ 10:03PM
Jason Cochran said...
Brooke,
Yes, Adventure Island water park is a Busch Park. So are Aquatica and Discovery Cove in Orlando. So they will be sold, too.
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1-20-2009 @ 10:46PM
Celeste said...
I don't think Disney should buy up the other parks even though I love Disney! I like the way the other parks are run and they have a different slant on their themes. What would happen to Discovery Cove? I've been there 3 times and Anheiser-Busch did a great job developing that. Sea World is the best. Just leave the Mouse in Disney World, etc. Keep competition or else it's just more of the same.
Reply
1-21-2009 @ 12:14AM
been going to busch gardens every week since i was born 33 years ago said...
god please dont let disney buy, busch gardens and sea world.
They will jack up the very reasonable annual admission prices sky high and ruin everything good about the parks.
that is if they even keep it open.
There is only one reason i can see why disney would want to pick up busch gardens, and that is to close it cause its to much competion for walt disney world's similarly themed Animal kingdom. Its a fact Busch Gardens does more attendance annually than Animal Kingdom.
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1-21-2009 @ 1:12PM
Phil said...
In 2007 Busch Gardens in Tampa did 4,400,000 in attendance and Animal Kingdom at WDW did 9,490,000.
I would agree that if Disney were to buy Busch Gardens Africa that it would be eiter sold or closed. I could see Disney trying to get Seaworld in SanDiego and Orlando and trying to get maybe Merlin to buy the rest.
1-26-2009 @ 3:23PM
Nate said...
Dude, check your facts. BG Africa has NEVER outdone Animal Kingdom.
1-21-2009 @ 2:05PM
Paul said...
I have been going to BG for years and I have never seen a stand that was offering free beer. If it was the policy it was not promoted very hard. I love BG and my kids do also. The (free) with admission Summer Concerts are always a hit.
Reply
1-22-2009 @ 3:51PM
Ryan said...
The free beer was in the hospitality house. Now Called Bid garden cafe or somthing like that.
1-21-2009 @ 11:36PM
Samuel said...
I hope either Parque reunido or Merlin Ent buy the parks even if they have to split them up. I really would hate to see Disney have a Monopoly in Orlando!
Reply
1-21-2009 @ 4:50PM
Aaron said...
If Disney does buy the Busch theme parks, it will no doubt close or consolidate most of them, taking the relative income "loss" to eliminate competition.
1. In Florida, they most certainly would close Busch Gardens, transferring the animals and some of the rides to Disney's Animal Kingdom (and instantly creating a complete theme park.) They'd also close Sea World and Aquatica, again transferring the animals and some of the rides to Epcot and Animal Kingdom. They'd also go for a Disney polish over all these assets. But Busch-as-theme park would no longer exist in Florida.
2. In Williamsburg, I'd estimate that this would be the location for the long-gestating Disney's America project, effectively ending the exisitence of Busch Gardens in the United States.
3. As for the rest of the Sea Worlds, I'd expect them all to be consolidated and closed, with the animals and rides going to Disneyland in California.
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1-22-2009 @ 10:55AM
Guy T. Koepp said...
Why on earth would Disney spend 4.5 billion on Busch parks to then turn around and spend 2+ more billion to dismantle them because their "the competition." Bob Iger is much smarter than that. The Busch parks are extremely well managed and quite profitable. You would in effect be destroying an already lucrative monetary stream. It seems to me that the smart thing to do if they did buy Busch would be to leave everything in place as is. Not even attaching the Disney name to them. You keep the existing management in place to continue their success and hire a Disney rep to supervise and report directly to Iger. Honestly, this would be a win win situation for Disney. In essence "the competition" would no longer be the competition. 70% of the general public would have no Idea the two brands were merged and the revenue stream would continue as if it were still going in to the Busch coffers. People would plan their week long Orlando vacation just like they would normally. Making plans to visit the Disney parks as well as the Busch parks. The only difference would be that those revenue streams are now going into the same coffer.
If I worked for Disney. I would try to keep this little transaction as quiet as possible and keep everything exactly as is. Come on! Think about it. If Animal Kingdom pulled in 9.5m people last year, and BG Africa pulled in 4.5m. Guesstimate 50% of BG Africa's also spent a day at Animal Kingdom. That's 2.25m people. At $60 a pop. That's an extra $135m from people who visited both parks that Disney can get without lifting a finger. From 1 park alone. The entire Busch chain nets over a bilion annually. Seriously, the investment buying the busch franchise would easily pay itself off in 5ish years.
Don't break a machine that works amazingly well. Buy it and let it keep working... ...for you!
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3-09-2009 @ 8:44AM
Matt said...
I think you've said it perfectly.
1-22-2009 @ 12:07PM
Pat said...
Disney would be a perfect siutor. First, the Williamsburg property is themed after Olde World Europe, a sister park could be built along side, the long rumored Disney America park. The Seaworld San Diego park is on the water and would be a perfect area to park their west coast cruise line. Orlando of course, has three parks, Seaworld, Aquatica, and Discovery Cove (a boutique park Disney has wanted to copy) These and the property not yet developed could form DisneySea Resort, along with some themed resort hotels which would make this a separate distenation from Walt Disney World. A connection by monorail would be sweet! Seaworld San Antonio would give them a rumored Texas presence. That leaves a couple thorns in the Busch (pun intended). Busch Gardens Tampa and Adventure Island, possibly removing the animal theme and selling both to someone else might be a solution and help defer the large price tag.
Reply
1-28-2009 @ 4:27PM
Riley said...
I agree that Disney is the best positioned and best suited to take up the Busch properties. Frankly, I'd be concerned about any other company's ability to keep up the properties to the standards set by Busch.