Banks vie for £2bn float by owner of Madame Tussauds

Madame Tussauds owner Merlin Entertainments Group is in final preparations for a £2bn London Stock Exchange listing in early 2009 that could propel it into the Ftse-100.

Goldman Sachs, JP Morgan Cazenove, Citi, Merrill Lynch, Deutsche and BNP Paribas have all pitched over the summer to be one of two bookrunners for the listing.

Although a formal beauty parade for advisers has not been held, all the banks have presented their cases for the mandates over the past two months. They are awaiting a decision by Merlin and its owner, private equity giant Blackstone.

Citi and Goldman were identified by one market source as the favourites, as they could provide the necessary financial muscle to refinance Merlin's debt burden, a necessity ahead of a listing. Although the debt is believed to be more than £1bn, this is not a heavy burden on a company the size of Merlin.

A listing has long been the ambition of Blackstone and Merlin's management. In a newspaper interview in July, Merlin's chief executive, Nick Varney, said: "If a flotation is going to happen then the markets have to be open – and at the moment they're not." He added: "Merlin would be a very strong and popular listing but I can't say at the moment if we're going to float."

It was believed that the chance of a listing had been delayed until the second half of next year, but it seems that the recent stock market rally has made Merlin and Blackstone reconsider.

Merlin, based in Poole, Dorset, has been the poster child of the private equity industry, regularly cited as one of its greatest successes. The group was originally known as Vardon Attractions, which owned the Sea Life Centres, and has grown into the world's second biggest entertainment group after Disney.

Under a "buy-and-build" strategy, in which private equity owners purchase complementary business to create a powerful empire, Warwick Castle, Legoland and the London Eye are among the many attractions to have become part of Merlin.

A leading leisure sector banker said: "They [management and Blackstone] are trying to do this as soon as possible – quarter one 2010 or even quarter four this year."

A second source said that Merlin is "playing its cards close to its chest" over the appointments, but confirmed that two advisers would be necessary due to the size of the flotation. It is understood that banks have told Merlin that a listing could be worth from £1.75bn to more than £2bn.

There are suggestions that Blackstone could include Center Parcs, the resorts group the private equity giant bought in 2006, in the listing, which should ensure that the deal was of enough scale to put Merlin in the Ftse-100.

In 2008, Merlin's revenue was £662m, which was bolstered by the previous year's purchase of the Tussauds Group, which owned Alton Towers as well as the international waxwork exhibitor, for £1bn.

Blackstone is also examining options for the Hilton hotel group, another company in its portfolio, which it brought for $26bn (£16bn) at the height of the market in 2007. The choices include debt-for-equity swaps for parts of the business and public listings along geographic lines. Hilton, like most hotels, has struggled during the recession. It is thought that Blackstone wrote down the value of its investment by 50 per cent last year. The group is heavily indebted – $21bn was originally borrowed to complete the purchase.

PROMOTED VIDEO
News
Wayne’s estate faces a claim for alleged copyright breaches
John Wayne's heirs duke it out with university over use of the late film star's nickname
News
peopleIndian actress known as the 'Grand Old Lady of Bollywood' was 102
News
business
News
Mick Jagger performing at Glastonbury
people
Extras
indybest
Life and Style
beautyBelgian fan lands L'Oreal campaign after being spotted at World Cup
Sport
Germany's Andre Greipel crosses the finish line to win the sixth stage of the Tour de France cycling race over 194 kilometers (120.5 miles) with start in Arras and finish in Reims, France
tour de franceGerman champion achieves sixth Tour stage win in Reims
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

JQuery Developer (JQuery, C#, front-end, JQuery, UI, Tomcat)

£40000 - £45000 per annum: Harrington Starr: A Global Financial Service Organ...

Linux Systems Administrator - UNIX, Linux, Shell, Bash

£50000 - £60000 per annum: Harrington Starr: Linux Systems Administrator - UNI...

UNIX Systems Administrator - Oracle DBA, UNIX, Scripting

£40000 - £45000 per annum: Harrington Starr: UNIX Systems Administrator - Orac...

Linux Systems Administrator - (Support, Linux, UNIX)

£40000 - £55000 per annum: Harrington Starr: Linux Systems Administrator - (Su...

Day In a Page

The true Gaza back-story that the Israelis aren’t telling this week

The true Gaza back-story that the Israelis aren’t telling this week

A future Palestine state will have no borders and be an enclave within Israel, surrounded on all sides by Israeli-held territory, says Robert Fisk
A History of the First World War in 100 Moments: The German people demand an end to the fighting

A History of the First World War in 100 Moments

The German people demand an end to the fighting
New play by Oscar Wilde's grandson reveals what the Irish wit said at his trials

New play reveals what Oscar Wilde said at trials

For a century, what Wilde actually said at his trials was a mystery. But the recent discovery of shorthand notes changed that. Now his grandson Merlin Holland has turned them into a play
Can scientists save the world's sea life from

Can scientists save our sea life?

By the end of the century, the only living things left in our oceans could be plankton and jellyfish. Alex Renton meets the scientists who are trying to turn the tide
Richard III, Trafalgar Studios, review: Martin Freeman gives highly intelligent performance

Richard III review

Martin Freeman’s psychotic monarch is big on mockery but wanting in malice
Hollywood targets Asian audiences as US films enjoy record-breaking run at Chinese box office

Hollywood targets Asian audiences

The world's second biggest movie market is fast becoming the Hollywood studios' most crucial
Grindr founder Joel Simkhai: 'I've found love on my dating app - and my mum keeps trying to hook me up!'

Grindr founder Joel Simkhai: 'I've found love on my dating app'

Five years on from its launch and Grindr is the world's most popular dating app for gay men. Its founder Joel Simkhai answers his critics, describes his isolation as a child
Autocorrect has its uses but it can go rogue with embarrassing results - so is it time to ditch it?

Is it time to ditch autocorrect?

Matthew J X Malady persuaded friends to message manually instead, but failed to factor in fat fingers and drunk texting
10 best girls' summer dresses

Frock chick: 10 best girls' summer dresses

Get them ready for the holidays with these cool and pretty options 
Westminster’s dark secret: Adultery, homosexuality, sadomasochism and abuse of children were all seemingly lumped together

Westminster’s dark secret

Adultery, homosexuality, sadomasochism and abuse of children were all seemingly lumped together
A History of the First World War in 100 Moments: Dulce et decorum est - a life cut short for a poet whose work achieved immortality

A History of the First World War in 100 Moments

Dulce et decorum est: a life cut short for a poet whose work achieved immortality
Google tells popular music website to censor album cover art in 'sexually explicit content' ban

Naked censorship?

The strange case of Google, the music website and the nudity take-down requests
Howzat! 8 best cricket bats

Howzat! 8 best cricket bats

As England take on India at Trent Bridge, here is our pick of the high-performing bats to help you up your run-count this summer 
Brazil vs Germany World Cup 2014 comment: David Luiz falls from leader figure to symbol of national humiliation

David Luiz falls from leader figure to symbol of national humiliation

Captain appears to give up as shocking 7-1 World Cup semi-final defeat threatens ramifications in Brazil