Merlin Entertainments is worth more than three billon pounds, according to its long awaited stock market flotation.
The world’s second largest attraction operator made its debut on the London Stock Exchange, after several false starts, on 8 November. Trading near the top end of expectations, shares rose during the first hour of conditional trading over 12% from 315 to 355p. At the time of writing they were 349p each. This values the company at £3.2 billion ($5.1bn/€3.8bn).
The initial public offering (IPO) of 304 million shares represents 30% of the company, and raised £957 million. Merlin retains Lego Group owner Kirkbi and private equity firms Blackstone and CVC as major shareholders, with reduced stakes of 29.9%, 22.6% and 13.1% respectively. Chief executive Nick Varney is reported to have sold shares worth £10 million, while other senior executives and around 2,000 staff are expected to share in a windfall of around £200 million. After paying off these and other investors, the float raised £165m for reducing debt. Financial institutions account for 87.5% of the new shareholding. The remainder went to retail investors, who were offered discounts on a Merlin Annual Pass if they bought at least £1,000 worth of shares.
As readers of this publication may well be aware, Merlin Entertainments is the operator of parks and resorts including Legoland, Heide Park (Germany). Gardaland (Italy) and England’s Alton Towers, Chessington World of Adventures and Thorpe Park (pictured). The group generated revenues last year of over £1 billion ($1.6bn/€1.2bn), but is still some way short of Disney both in terms of revenue and combined attraction attendance.
According to Merlin’s IPO prospectus, however, it is the group’s “Midway” attractions such as Madame Tussauds, Legoland Discovery Centre and Sea Life that generate better percentage profits due to their relatively low investment. The company currently operates 99 individual attractions in 22 countries and is placing growing emphasis on its North American and Asia-Pacific operations as its attempts to create a more even spread of revenues internationally.