Tokyo Disneyland Prepares for Catastrophic Earthquake with $1.3B Line of Credit

Tokyo Disneyland has requested and been granted an increase on their catastrophic line of credit. The $1.3B line of credit represents a 50% increase in their existing allowance, according to website nikkei.com.

The line of credit would let the Oriental Land Company completely shut down the park for six months while still being able to cover personnel costs, capital investment payments, and even continued investment in the expansion of the park.

A move like this isn’t new for the Oriental Land Company. In 1999, it became the first non-financial company in Japan to get a catastrophe bond.

Of course, back in 2011, planned power outages after a tsunami devastated northeast Japan forced Tokyo Disney Resort to shut down for over a month. The resort lost an estimated $400 million in profits during the closure.

The new line of credit carries an annual fee of 300 million yen, which is less than half of one percent of the resort’s operating profit.

1 COMMENT

  1. […] The Tokyo Disneyland Resort has asked for an been approved for an increase on their catastrophic line of credit that would be used in case of the park being out of commission for any reason. With the new line of credit, the Oriental Land Company, which owns the resort, could shut the parks down for up to 6 months. It is not unheard of for the resort to have to shut down for long periods of time. Back in 2011, when a tsunami hit and there were planned power outages, the resort closed for over a month, losing an estimated $400 million in profits. – http://blogmickey.com/2019/03/tokyo-disneyland-prepares-for-catastrophic-earthquake-with-1-3b-line-o… […]

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