Walt Disney Corporation to Acquire MIT for $8.9 Billion
Top Ranked Engineering School will switch to Imagineering
May 5, 2005
CAMBRIDGE, MA, May 5, 2005 -- The Massachusetts Institute of Technology and the
Walt Disney Company (NYSE:
DIS) today announced the signing of an agreement whereby Disney will acquire MIT, a coeducational university located in Cambridge, Massachusetts. This unprecedented acquisition of a non-profit educational institution by a Fortune 500 company will be accomplished by Disney setting up a $8.9 billion cash scholarship trust fund. The fund will be used to reimburse past students for tuition, and provide scholarships for students for the next 20 years.
"The acquisition of MIT represents a new phase for the Walt Disney Company. In recent years, the increased power of computers has made it possible to create dramatic new forms of entertainment ranging from a film like Toy Story to an attraction such as Indiana Jones Adventure at Disneyland to Internet sites like Disney.com. The addition of some of the nation's finest minds and most original thinkers will help us wisely plot our course into the next century. The talents of MIT faculty and students will uniquely position us to seize the possibilities that technology will be offering", said Michael Eisner, Chairman and CEO of the Walt Disney Company.
The idea of the acquisition grew out of talks between Disney and the MIT Media Lab regarding the next generation of television. "We were very impressed by the technology that MIT had", said Thomas James, a Disney spokesperson. "As we became acquainted with the other assets of MIT, the negotiations expanded to include the whole university. The biggest challenge were the legal hurdles. The non-profit nature of the school dictated that the payment has to be given to charity. The fact that MIT is a land-grant university means that the land has to be given back to the Federal government."
As part of the acquisition, the entire MIT campus will be moved brick by brick down to the Walt Disney resort complex in Orlando, Florida, so that the 153 acres that MIT currently occupies can be returned. "Moving the Institute is a giant undertaking, but I feel that the MIT Civil Engineering department is up for the challenge", said Joel Moses, MIT provost. "The high Florida water table means that the Institute basements and subbasements cannot be underground. We plan to dig out a new Charles river down in Florida, and use the landfill to place the Institute two stories above sea-level, much like the vaunted utilidor system under the Magic Kingdom.
MIT sees many benefits from the acquisition. "The recent tuition riot pointed out that something had to be done about the skyrocketing cost of tuition", Charles Vest, MIT President said. "Besides the large scholarships that the trust fund will provide, the new location in Florida will help us attract students that would ordinarily go to warmer climates such as Palo Alto and Pasadena. The ability to offer Disney stock options will make it easier to recruit and retain world-class professors and staff."
MIT students will see some immediate effects of the Disney acquisition. The various MIT departments and schools will be named after Disney characters. For example, the school of Engineering will become the school of Imagineering, and the Sloan School will be renamed the Scrooge McDuck School of Management. According to Samuel "Jay" Keyser, Professor in the Donald Duck Department of Linguistics, who was on the MIT negotiating team, the first noticeable change will be Disney characters appearing in lectures. "The presence of these characters in class will keep students awake and enhance the learning process," Keyser said, "In time, student morale will be improved by nightly parades down the Infinite corridor, followed by firework displays over the Great Dome." Once the move to Florida is complete by 2018, the campus will finally have a
monorail system and access to the entire Walt Disney World resort complex. Disney says that it intends to immediately benefit from the acquisition by redirecting the resources of the "Land of Computer Science" and the "Artificial Imagination Laboratory" to its internal Information Systems needs, ranging from Year 2020 projects to ride control to improving web security. The biology department will begin to genetically engineer new attractions for Disney's Animal Kingdom, slated to open this Spring. Disney is also planning on an animated cartoon adventure of "Nick the Nerd", slated for release in the summer of 2007. Disney is also considering adding
"Noun Poetry" to its
Disney Afternoon lineup.
As part of the acquisition, MIT President Charles Vest will receive a pay increase and become Disney Vice President for Nerd Education. Once the move is completed, the school will merge with the Disney Institute and will be renamed the Disney Institute of Technology. When asked what he planned on doing now that he had just finished selling the Institute to Disney, Charles Vest had no comment. <CENTER>--END--</CENTER>
