Disney to break ground on Shanghai park on Friday: Source

Walt Disney Co will hold a ground-breaking ceremony for its Shanghai Disneyland theme park on Friday, a source with direct knowledge of the plans said on Wednesday.

The firm signed in November an agreement with a government-backed Shanghai company for the establishment of a park expected to cover 4 square kilometres. The first phase of the park is expected to cost about 24.5 billion yuan ($3.74 billion).

"It is a ground breaking event for the theme park," said the source who declined to be named because the information was not yet public.

The Shanghai Disneyland will be Disney's first park in mainland China and its third in Asia. Disney has long sought to build in Shanghai, a wealthy city of about 20 million people that is ringed by the prosperous Yangtze River Delta, home to tens of millions more potential visitors.

Disney's foray into the China market has been mixed so far. Although its Hong Kong Disneyland park opened to great fanfare, at times it had struggled to attract as many visitors as hoped.

Local media reported that Disney is hoping to attract 7.3 million visitors to the Shanghai park annually.