Well, as expected, Eisner has 12 months to show significant improvement and the best way to do that is to slash assets and sell off what you can to show an improvement on the bottom line, even if it's just for a couple of quarters... The sports teams, ABC News, ABC Radio... what next? There was early speculation that Disney might sell the cruiseline and then lease the ships back. Like that, the expense of operating the ships doesn't show up as red ink on the books, but profits still show up as black ink. In my opinion, it'll be a huge mistake to do something like this. But it's what Disney did with their office buildings in Celebration, FL (sold them then leased them back). There's also been talk of leasing out some of the resorts at WDW. Does this look like a nightmare in the making or what? Mop
The whole sell/lease red ink/black ink issue seems pretty under-handed to me. Has Michael Eisner been getting pointers from Kenneth Lay or something? I think he's doing anything, regardless of whether it's ethical or not, to make sure he keeps his job. If they buy it, hey, he'll be employed for a little longer, if not, "screw 'em", the damage will have been done & it's a YP at that point.
Ditto's the fact it is a nightmare!!! lets ust hope it isnt like the movie groundhog day and it doesnt end!!
Selling assets and then leasing them back is more common these days than you may think. Selling real estate brings instant cash to a company that is having financial troubles and leasing back is a write off. For many companies in this failing economy this is a win-win proposition. JMHO Annmarie
