Publications
Publications
- March 2001 (Revised April 2003)
- HBS Case Collection
Chase's Strategy for Syndicating the Hong Kong Disneyland Loan (A)
By: Benjamin C. Esty and Michael Kane
Abstract
In late 1999, the Walt Disney Co. and the Hong Kong government agreed to develop Hong Kong Disneyland, a HK$28 (U.S.$3.6) billion theme park and resort complex planned to open in late 2005. As part of the total financing package, the sponsors decided to raise HK$3.3 billion of non-recourse bank loans for construction and working capital, and selected Chase Manhattan Bank to underwrite and syndicate these facilities. This case concerns the process by which Chase successfully competed to lead this transaction. The key questions facing Chase were whether to bid at all, how to bid, and how to structure the syndication to meet the borrower's needs, its own profit objectives, and the market's expectation for an attractively priced credit. Includes a generic section about the process, participants, and economics of syndicated lending for students who are unfamiliar with syndicated lending. This is part of a module on Financing Projects in the Elective Curriculum (EC) course Large-Scale Investment (LSI). Although written for a course on project finance, it can easily be modified for courses on capital markets or financial institutions.
Keywords
Working Capital; Project Finance; Relationships; Financing and Loans; Financial Strategy; Tourism Industry; Hong Kong
Citation
Esty, Benjamin C., and Michael Kane. "Chase's Strategy for Syndicating the Hong Kong Disneyland Loan (A)." Harvard Business School Case 201-072, March 2001. (Revised April 2003.)