: Ownership structure of Shanghai Disneyland
Shanghai Disneyland is a joint venture between The Walt Disney Company and the state-owned Shanghai Shendi Group (Shendi), which was established in August 2010. Shendi’s chairman, Fan Xiping, was the vice-secretary general of the Shanghai municipal government. This joint venture is comprised of two owner companies and one management company. All three companies were registered on April 2, 2011, according to China’s National Enterprise Credit Information Publicity System. The management company is responsible for designing and operating the resort on behalf of the owner companies. In the owner companies, Shendi holds 57 percent of the shares, and Disney holds the remaining 43 percent of shares. In the joint venture management company, Disney has a 70 percent stake and Shendi holds 30 percent of Shanghai Disneyland (Table 3.1). For the management of Shanghai Disneyland in the joint venture management company, Disney is entitled to receive management fees based on operating performance of the resort. Shanghai Disney Resort, with a reported first-stage investment of USS3.7 billion, later amended to US$5.5 billion, is Disney’s largest foreign investment so far.
Shanghai Disneyland has a different ownership structure from the other Disneyland. Before further examining the ownership structure of Shanghai Disneyland, I will first attend to Disney’s ownership in the other Disneyland outside of the United States: Tokyo Disneyland, Disneyland Paris, and Hong Kong Disneyland, to understand the differences of Shanghai Disneyland.
Table 3.1 Ownership structure of Shanghai Disneyland
Disney Shanghai Shendi Group
Disney ’ s ownership in overseas Disneyland: Tokyo, Paris, Hong Kong, and Shanghai
Opened in 1983, Tokyo Disneyland was the first Disneyland built outside of the United States. It is a special case in terms of its ownership. Instead of investing in Tokyo Disneyland, Disney licensed Tokyo Disneyland to a local Japanese company. Oriental Land Co., Ltd., with zero percent of ownership but earnings of royalties on revenues. The main reason that accounted for Disney’s authorization of Oriental Land Co., Ltd. to fully own and operate Tokyo Disneyland was financial concerns. During a time of financial predicament as discussed in the histories of the company, Disney was conservative about the risk of investing in the new business of international Disneyland. To Disney’s surprise, Tokyo Disneyland enjoyed great business success right from its opening. Its phenomenal success boosted Disney’s ambition and confidence in building another Disneyland outside of the United States.