Once upon a time, in a popular tourist destination called the Magic Kingdom, there lived some very prosperous characters. They were happy all the time . They produced souvenirs, cartoons and movies that were the delight of families around the world. But one day a great disenchantment fell over the kingdom, for the magic no longer worked. Tinker Bell’s pixie dust had lost its twinkle. A teenage boy was even heard to say, “I wouldn’t be caught dead going to one of their movies.” The whole kingdom fell into such deep gloom that ruthless Corporate Raiders attacked the magic realm, aiming to sell off its treasures and keep Cinderella’s Castle as their trophy. But a man named Roy, noble nephew of the late Uncle Walt, sought help from the one person in whom everyone could believe: Prince Michael the Creative. When Michael arrived, there was rejoicing along Mickey Avenue and Dopey Drive. The happy sounds even attracted a wealthy white knight named Sid the Bold. “Michael puts a smile on my face,” proclaimed the once somber Sid. The kingdom’s citizens, singing “Hi ho, hi ho,” went back to work, making more magic than ever before. From somewhere far beyond the kingdom, Uncle Walt could be heard whistling his happiest tune, Zip-A-Dee Doo-Dah. Not long ago, America’s beloved Disney empire seemed destined for an unhappy ending. After an uninspired decade or more, Disney had fallen prey to takeover artists who wanted to break up the company like a rusty old carnival ride and sell its pieces to the highest bidders. But someone at Disney must have wished upon a star — maybe all 30,000 employees did. After sliding within a cricket’s whisker of defeat in 1984, Disney has come chirping back. Cheerleading a staff of go-team-go executives, Chairman Michael Eisner, 46, and President Frank Wells, 56, have pulled off one of the most dazzling corporate turnarounds since Lee Iacocca steered Chrysler back from the brink. Says Sid Bass, the Texas billionaire whose family has earned a paper profit of more than $800 million as the largest investors in Disney: “This is an incredible group of leaders. The hours they work are extraordinary, but they’re having a ball.” Rather than merely preserving Disney as a dusty institution, though, Eisner and company have reanimated its fantasy factory with their own ideas. Such characters as Mickey, Donald and Pluto are now being joined by the likes of Roger Rabbit, Webbigail VanderQuack and Georgette the poodle. From movies to theme parks to television to retail products, Disney is the hottest all-around entertainment maker in America. And maybe beyond: the most popular children’s TV program in China, seen by nearly 200 million viewers each Sunday evening, is the 1 1/2-year-old Mickey and Donald Show. Disney’s financial performance is a wonder as well. From fiscal 1983 through 1987, annual revenues more than doubled, to $2.9 billion, while profits nearly quintupled, to $444.7 million. During that time the value of the company’s stock has zoomed from $2 billion to nearly $10 billion. Says David Matalon, president of rival Tri-Star Pictures: “When it comes to Disney, there are two camps in this industry: extreme jealousy and admiration. I fall into the latter one.”
