(Reuters)
Walt Disney Co. on Friday will break ground on a new theme park and resort in Shanghai, according to people familiar with the matter, after years of red tape and negotiations with the Chinese government.
The groundbreaking ceremony follows Disney's recent receipt of final approval from the Chinese central government to move ahead with its long-gestating plans for the 963-acre park and resort. That is about 1/26th the size of the 40-square-mile Walt Disney World in Orlando, Fla.
Early Saturday morning, or late Friday in the U.S., invitations were issued by Disney, together with an arm of the Shanghai government and a local business partner of Disney's, inviting recipients to "a special event in Shanghai" on April 8. Disney Chief Executive Officer Robert Iger is expected to attend the groundbreaking ceremony. Shanghai Disneyland will be the Burbank, Calif.-based Disney's sixth major theme park in the world, and its first in mainland China.
Shanghai's mayor has estimated the cost of the first phase of the theme park will be 24.4 billion yuan, or $3.73 billion. The total cost of the resort isn't clear, but it is likely to be one of the largest foreign investments ever made in mainland China. The resort will be majority-owned by media and entertainment companies that are in turn owned by the Shanghai Municipal Government. Disney's stake in the endeavor hasn't been disclosed, though the company is expected to hold a minority interest.
In addition to Disney, the parties issuing the invitation were the Administrative Commission of Shanghai International Tourism and Resorts Zone and Shanghai Shendi Group Co. Ltd. The latter is Disney's government-owned joint venture partner, a company formed by various government-owned businesses that has investors including a subsidiary of broadcaster Shanghai Media Group and another responsible for construction.
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