Merlin Entertainments has agreed to be acquired by Berkeley Bidco Limited, a recently-formed company owned by Blackstone Core Equity Partners and Kirkbi.
The acquisition has been agreed at £6 billion.
Blackstone is a private equity company, and Kirkbi is the investment arm of Lego’s Kirk Kristiansen family. The Canadian pension fund, CPPIB, is also investing in the deal.
50% of Merlin Entertainments will be owned by Blackstone and CPPIB and the other 50% will be owned by Kirkbi.
The acquisition places Merlin shares at 455 pence per share, meaning the company is valued at £5,905 billion.
Sir John Sunderland, Merlin Entertainment’s chairman spoke about the deal.
“Merlin is a global leader in location based, family entertainment, with a unique portfolio of brands and attractions spanning 25 countries and four continents, and with a proven strategy that has delivered over many years.
“The company has generated meaningful value since IPO, with significant growth in revenue, earnings and cash flow. Following an unsolicited approach by a consortium of investors, and after rejecting a number of their proposals, the Merlin Independent Directors believe this offer represents an opportunity for Merlin Shareholders to realise value for their investment in cash at an attractive valuation.
“We are therefore unanimously recommending it to our shareholders.”
Søren Thorup Sørensen, chief executive officer of Kirkbi, said:
“As the long-term owner of the LEGO brand and as a strategic shareholder in Merlin since 2005, we have great pride and passion for this amazing company, its management team and its employees.
“With a shared understanding of the business and its culture, we believe that this group of investors has the unique collective resources necessary to equip Merlin, including the Legoland Parks and Legoland Discovery Centres, for their next phase of growth.
“We are committed to ensuring Legoland and the other activities in Merlin reach their full potential, which we believe is best pursued under private ownership, in order to deliver fantastic experiences to visitors of all ages around the world.”
Joe Baratta, global head of private equity at Blackstone, commented:
“We are pleased to partner with Kirkbi and CPPIB to acquire a business we know very well. We are prepared to commit the substantial resources required to support the long-term objectives of Merlin, which will require significant investment to ensure its long-term success.
“We believe we are uniquely placed with our long-dated investment fund, Core Private Equity, to make this investment alongside our partners at Kirkbi and CPPIB. We look forward to backing Nick Varney and his strong management team in driving Merlin into the future.”