TNAG-1617-FCO40-2225-Executive-Council-of-Hong-Kong-memoranda-and-minutes-of-meet-1987 — Page 58

For discussion

on 31 March 1987

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XCC (87)53 31

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MEMORANDUM FOR EXECUTIVE COUNCIL

OCEAN PARK CORPORATION BILL 1987

A

Introduction

The purpose of this memorandum is to seek Members' advice on whether the Ocean Park Corporation Bill 1987 (Annex A) which seeks to provide for the establishment and administration of an independent statutory corporation to be known as Ocean Park

Park Corporation to replace Ocean

Ocean Park Ltd., should be introduced into the Legislative Council.

Background

2

On 5 August 1986, the

the Executive Council considered Memorandum XCC (86) 139 in respect of a proposal from The Royal Hong Kong Jockey Club to

Jockey Club to divest itself of Ocean Park with a cash endowment of $200 million in order to concentrate on matters which are directly within their purview • i.e. racing and betting. The Council advised and the Governor ordered that the divestment should be made to an independent statutory corporation subject to an independent evaluation being carried out to determine the future financial viability of the proposed Ocean Park Corporation.

B

Financial evaluation

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An independent evaluation of the financial viability of Ocean Park for the five year period up to 30 June 1991 was undertaken by Arthur Andersen & Co. in November 1986, and the main findings and proposals have been summarized at Annex B for Members information. In essence, the consultants confirmed that Ocean Park would be able to support their proposed programme of capital improvements and maintain a positive cash balance at the end of each financial year through to 30 June 1991 provided that existing attendance levels could be. sustained and assuming a minimum 8% return on the investment of the $200 million endowment fund.

The Bill

4

The purpose of the Ocean Park Corporation Bill 1987 is to enable The Royal Hong Kong Jockey Club to divest itself

to divest

of responsibility for Ocean Park Ltd. to an independent statutory corporation to be set up and governed by its Own

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