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Disneyland Hotel May Be Up for Sale by New Owners of the Wrather Corp.

October 01, 1987|From Reuters

WASHINGTON — The Disneyland Hotel, which has housed tens of thousands of visitors to Anaheim's famous amusement park, may be put up for sale, the group buying the hotel's parent company said Wednesday.

Walt Disney Co. and Hong Kong-based Industrial Equity (Pacific) Ltd. agreed earlier this week to buy the 72% interest in Wrather Corp. that they do not already own for about $109 million.

Wrather, with headquarters in Beverly Hills, owns the Disneyland Hotel, operates the Queen Mary ocean liner and Spruce Goose airplane attractions in Long Beach, and has minor oil and gas interests.

In papers filed with the Securities and Exchange Commission, Disney said it might propose selling the Disneyland Hotel as part of a preliminary business plan it is preparing for Wrather's operations after the buyout.

Disney said if the 1,174-room hotel and convention facility is sold, it expects Wrather to manage the facility for its new owners. Alternatively, it said Wrather might retain ownership of the hotel and use its value as collateral for what it called a "substantial loan."

No potential buyers for the property were disclosed by Disney in the report to government regulators.

Disney said its preliminary plan also calls for the sale of Wrather's oil and gas assets.

It stressed that plans to sell or retain the Disneyland Hotel are preliminary at this point and said its business plan is scheduled for completion by Feb. 15, 1988.

In 1986, Wrather's hotel operations accounted for $60 million of its $108.4 million in total revenues, while its oil and gas interests brought in $2.1 million.

Attractions such as the Queen Mary--now used as a hotel and convention facility--and the Spruce Goose--Howard Hughes' giant World War II-vintage airplane--accounted for the remaining $46.3 million in revenues last year.

However, the company as a whole lost $8.7 million in 1986, contrasted with a profit of $4 million in 1985.

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