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LONDON – Walt Disney Company will inject cash into Euro Disney as part of a recapitalization plan worth about 1 billion euros, or about $1.25 billion, in hopes of improving the troubled theme park operator’s financial position.

Disney, the California media and entertainment giant, will inject €420 million in cash in exchange for shares. Euro Disney’s debt will be reduced as the parent company converts about €600 million in debt into shares.

Disney, which owns 40 percent of Euro Disney, will also defer certain loan payments until 2024.

“This proposal to recapitalize the Euro Disney Group is essential to improve our financial health and enable us to continue making investments in the resort that enhance the guest experience,” Tom Wolber, the Euro Disney president, said in a news release on Monday.

Shares of Euro Disney, which operates Disneyland Paris through a subsidiary, declined about 16 percent to €2.91 in midday trading in Paris on Monday.

Euro Disney shareholders will also have the opportunity to participate in the capital raising on the same terms as Disney.

Euro Disney, which opened outside Paris in 1992, has struggled over the years with financial issues, mainly tied to its debt.

The French company last turned an annual profit in 2008 ahead of the financial crisis, when it had an occupancy rate of over 90 percent at its resort hotels and more than 15 million visitors. Euro Disney earned €1.7 billion that year.

It has posted an annual loss every year since then, topping €78 million for the fiscal year ending on Sept. 30, 2013.

The company also has seen a severe decline in visitors in the past two years after surpassing 16 million in 2012. That year, Disney agreed to refinance €1.3 billion in debt for Euro Disney.

The French company has suffered declining attendance this year, which has cut into its revenue forecasts.

Euro Disney had 14.9 million visitors in 2013 but expects to have only 14.1 million to 14.2 million visitors this year.

Hotel occupancy for 2014 is expected be at 75 percent to 76 percent as the company faced lower attendance and a reduced number of rooms because of renovations, the company said.

The company said Monday that it expected to post revenue of €1.27 billion to €1.29 billion in the 2014 fiscal year, a decline of 1 percent to 3 percent from 2013.

As a result, Euro Disney said it expected to post a net loss of €110 million to €120 million in the 2014 fiscal year, compared with a net loss of €78 million in 2013.