Disney Mum on Arvida Plan

Walt Disney Co. officials refused comment Friday on a published report that the company is weighing a plan to sell much of its Arvida subsidiary to the public in the form of a master limited partnership.

Arvida Chairman Charles Cobb Jr. told the Wall Street Journal that he and several top Disney officials conferred recently with investment bankers to discuss ways to refinance the real estate development company, acquired two years ago by Disney for $214 million.

Although Cobb is a Disney director and member of its six-man executive committee, Disney spokesman Erwin Okun refused to confirm or refute Cobb’s reported comments.

“As a policy, we don’t comment on speculation about such matters,” Okun said.

Since a new management team took the helm at Disney in September, 1984, the company has undertaken extensive research for ways to turn some of Disney’s real estate assets into cash--including its $1.2-billion investment in Epcot at Walt Disney World.

Despite rumblings in the press, however, no announcements have been made.

Unlike most partnerships, a master limited partnership allows investors to buy or sell units in a public market. This form of spinoff is gaining popularity because the seller can retain control by becoming the general partner while raising cash through the sale of units.

Investors are pleased because the profits are taxed just once--at the dividend or payout level. Unlike corporations, partnerships pay no income tax.