New details on buyout option for Disney execs

Some new details were released yesterday about the buyout for executives in a story from the Orlando Sentinel:

The Walt Disney Co. offered buyouts Wednesday to more than 600
executives at its U.S. resorts -- including 313 in Orlando -- as the company
struggles to cut costs amid a worsening recession.The company planned to
hand-deliver buyout packages to 619 executives, each of whom will have until
Feb. 6 to decide whether to accept.Disney said it will resort to layoffs if too
few employees voluntarily walk away.

"We hope to achieve our goals with the VSP [voluntary separation plan],
but an involuntary layoff with a lesser severance package will be required if
our goals are not met," Jayne Parker, senior vice president of human resources
for Walt Disney Parks and Resorts, wrote in a letter to the affected executives.

In a written statement, Disney blamed the move on the country's hobbled
economy. The parks-and-resorts division is particularly vulnerable as consumer
spending is squeezed by sinking home values, rising unemployment and tightening
credit.

Analysts at Morgan Stanley estimate that combined attendance at Walt
Disney World and Disneyland will drop 7 percent this year."Given the continued
uncertainty of the economic environment, we must manage our business even more productively," Disney spokeswoman Leslie Goodman said in the statement. "This immediate action is designed to allow us to deliver an outstanding guest
experience and remain focused on achieving long-term growth."

Disney declined to reveal the savings it hopes to achieve through the
buyouts. It also would not provide details of the terms of the packages, though
individual offers depend on length of service and other factors, such as pension
accrual.

The buyouts were offered to 313 executives in Orlando at Walt Disney
World, Disney Vacation Club and Disney Cruise Line.

-- click on the link above to read the rest of the article --

I really hope most cast members will weather this economic storm safely. I also hope Disney will do everything it can to keep the magic as magical as it has been. While I'm not pleased about some of the reduced showings of Fantasmic!, I have to accept that Disney has got to do what it can to cut costs - everyone is doing that right now.

Disney stock has taken a massive hit. As of this post, Disney stock was trading just barely above $20/share, down $15/share from the one-year high of $35/share last March. Maybe now's the time to buy Disney stock - I can only hope it will go back up from here, but who knows.