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Fri 28th Jun 2019 - Merlin board recommends £6bn offer
Merlin board recommends £6bn offer: The board of Merlin Entertainment has a recommended a cash offer worth almost £6bn from private equity firm Blackstone, Canandian pension firm CPPIB and Kirkbi, a company operated by the Danish family that control Lego that already has a 29.58% stake in the business. Merlin shareholders are being offered 445p, a 36.8% premium on the closing price of the shares on 22 May. The acquisition values the entire issued and to be issued share capital of Merlin at approximately £4,766 million on a fully diluted basis and implies an enterprise value of £5,905 million and a multiple of approximately 12.0x Merlin’s underlying Ebitda of £494 million for the year ended 29 December 2018. Kirkbi has maintained a significant strategic shareholding in Merlin since the sale of Legoland Parks to Merlin in 2005. Kirkbi and Blackstone jointly controlled Merlin in the eight years prior to the 2013 public listing, during which time Merlin became the second largest location based entertainment business globally, and the partner of choice for the world’s leading brands to deliver immersive experiences to guests. A statement said: “The Consortium recognises that significant, long-term investment is required to ensure the longevity of the existing assets and to drive continued growth for Merlin and its stakeholders. As Merlin’s largest shareholder and a key intellectual property partner, Kirkbi recognises the significant benefits of a shareholder group with a similar long-term investment horizon and shared commitment to increased investment in the business. Private ownership, in partnership with Blackstone’s long-term Core Private Equity strategy and CPPIB, will better enable the management team to focus on and execute their strategic vision for the business. Kirkbi has agreed to work exclusively with the other members of the Consortium in relation to the offer. This unique group of investors is equipped with the appropriate long-term investment horizon, expertise and capital required to realise Merlin’s potential to grow all branded experiences across its Midway Attractions, Legoland Parks and Resort Theme Parks.” Merlin’s roots date back to 1979 and its opening of a single aquarium in Scotland. The group expanded across the UK and continental Europe before its management group led a buyout of the company in 1999. It then changed hands in 2004 and 2005, first to private equity group Hermes and then to Blackstone and Kirkbi. In 2013 it was listed on the London Stock Exchange at 315p per share. A serious accident on a rollercoaster at its Alton Towers attraction in 2015 and the London terror attacks in 2017 both caused sharp drops in the share price. 

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