HONG KONG - HONG KONG Disneyland's much-awaited expansion would increase the size of the park by a third and cost around 3.5 billion Hong Kong dollars (S$650.6 million), a report said on Tuesday.

The park, desperate to expand its operation to boost disappointing visitor numbers, would aim to open three new themed 'lands', the South China Morning Post reported, citing the park chief executive Andrew Lam.

Mr Lam told the paper the expansion would amount around half of the HK$7.2 billion cost of a new cruise terminal planned in the city.

The park remained in negotiations with the city's government, which owns a 57 per cent stake, over the financing for the expansion, the report said.

Mr Bill Ernest, Walt Disney Parks and Resorts president and managing director for Asia, said any potential deal was not straightforward.

'I think the business is complex because any time we go in with our own level of capital, it puts it into the overall mix and then the government has to determine how it wants to handle it,' he said, according to the Post.

'So it's not an easy negotiation, but it is ongoing and frankly it has been for a while.'

Mr Kam said the government would remain the majority shareholder, but its stake may be diluted if Disney's parent firm paid for all of the new development.

The park celebrated its third anniversary in September, but it has struggled to hit visitor targets and Mr Kam has said expanding the park was a priority. -- AFP