cquired the Disney Store chain in 2004 in a licensing agreement.

“The Company believes the Disney Stores can be an important extension of the ‘Disney’ brand and, with the improved economics provided by a smaller store footprint, could add value to the Company in the promotion and monetization of its growing number of robust franchises,” Disney said in a statement.

In interviews, Gary Foster, senior vice president of Disney Consumer Products said that the new chain would be approximately 2/3 the size of the current chain of stores.

Disney, who still operates the Disney Store chain in Europe, would use the North American operation to bolster its growing consumer products business. "The company has done a phenomenal job of creating new franchises and has broadened our appeal to include boys and older kids," Foster said. "It's much easier to launch franchises in Europe from a retail perspective if you have complete control, over the timing of the entertainment content, timing of the merchandise launches, and a retail outlet where you can really focus on those.”

Disney has also announced plans to open over 100 new retail locations in India. "India is a high priority market for us," said Roshini Bakshi, Disney Consumer Products regional director. "We will open 150 stores for our consumer products across the country by 2011."