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Disney has been in business for such a long time. The name
can be associated with T.V shows, movies, games, and toys
and clothes. But as of lately one of the most prominent stores
are being closed down. Why you may ask? Well, I have the answers
in the simplest form.
Retail advisors Goldman Sachs and Bear Stearns have given
Disney good advice for 3 years. Both banks have worked with
Disney on 4 of its biggest transactions. Disney knows that
surely Sachs and Stearns are good business partners. Because
of this, they have also been hired to help Disney in the selling
of its stores.
The reason in which Disney wants to sell their stores is concerning
money. Profits have dropped 38%, from approximately $140 million
to $53 million. Revenue has also dropped recently 14%, from
approximately $3570 million to $500 million. This amount of
net-loss is extreme and has passably hurt the business.
Though the Walt Disney Company is the second largest U.S.
media company and they have 480 stores (374 in North America
and 106 in Europe), if they decided to sell the to banks,
each bank will make about $1oo million more than the Disney
stores has made.
Very interesting is the fact that no one wanted to comment
on the Disney situation: - Disney consumer products spokesman,
Gary Foster, declined to comment.
Alan Schwartz, present of Bear Stearns, hasn’t returned
any phone calls.
Goldman Sachs spokesman, Andrea Rachman, also did not comment.
Though Walt Disney Co. will be closing down stores, this not
mean that they have fully died out. Disney has licensed agreements
from retailers such as K-Mart and Wal-Mart stores Inc. Their
brand will be sold. Everything from backpacks and shirts to
jeans and other things having to do with Disney characters.
Though Disney storeowners feel that it’s mandatory to
close, the people do not feel this way. When asked the question,
how do you feel about Disney Stores closing? this is what
Rachael, age 28, from the Bronx had to say: “ I buy
my little boy’s toys from there (for every occasion).
He loves Mickey Mouse and now I can’t buy him nothing
Mickey Mouse because stores are closed”. I told her
that she could buy Mickey from Disney stores because it seems
more official.
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