Troubleshooters step in to aid struggling theme park

A team of financial consultants is expected to assist the ill-performing Yamay International Development Corp (月眉開發), which runs the Mala Bay (馬拉灣) theme park in Taichung County, in an attempt to develop a plan to revive the nation's biggest recreational facility.

"Yamay has agreed to seek professional management expertise from the Turnaround Management Association of Taiwan (台灣重建協會), which will dispatch a five-member team acting as an independent third party to work out a feasible plan," association chairman Lee Yung-san (李庸三) told a press conference yesterday.

According to Taiwan Securities Co (台証證券) president Lin Keh-hsiao (林克孝), who co-heads the turnaround team, Yamay remains a worthwhile investment because the 200-hectare site is the nation's biggest recreational facility, with well-planned infrastructure including access to the Sun Yat-sen Freeway.

"Yamay needs to renew its management model to attract new investors to inject money into future development projects," Lin said at yesterday's press conference.

Yamay opened the Mala Bay theme park in July 2000. But the nation's economic downturn over the last three years contributed to its financial difficulties.

Since January last year, Yamay has defaulted on its syndicated NT$6.9 billion loan from 21 banks, including the First Commercial Bank (第一銀行) and Chang Hwa Commercial Bank (彰化銀行), which had threatened to foreclose on the mortgage because Yamay had failed to propose a satisfactory repayment plan.

If the banks allow Yamay to credit its interest payments of NT$105 million, the company's NT$6.9 billion syndicated loan will become a performing loan again next month, Yamay vice president Luke Tan (譚元凱) said yesterday.

Yamay also owes NT$290 million in royalties and rent to the state-run Taisugar (台糖). But Tan yesterday said his company had agreed to terms with Taisugar.

Despite the impact of SARS in the second quarter last year, Tan said the company had brought in NT$680 million in revenue in 2003. The company said in September last year that it wanted to bring in NT$800 million this year.

Speaking on re-capitalization plans, Tan said that the company, which has a working capital of NT$5.5 billion, is currently under-capitalized by NT$500 million for first-phase construction and by NT$2 billion for second- and third-phase construction.

"We hope that the financial consultant team can provide advice to locate strategic investors who will be willing to inject fresh capital into the NT$25 billion project, because shareholders have expressed little interest in investing more," Tan said.

Two of the company's biggest shareholders -- Yao Hua Glass Co (耀華玻璃) and the Cabinet's Development Fund (開發基金) -- have decided not to inject more money into the company. The government fund has invested a total of NT$400 million in the theme park.