Merlin hopes to conjure more market magic

In the wake of the massive demand for Royal Mail’s £3.3bn flotation, next off the blocks could be the Madame Tussauds and Legoland owner Merlin Entertainments.

An “intention to float notice” is likely to be relayed to the stock market within a fortnight. A final decision to push the button by Merlin’s lead bankers, Goldman Sachs and Barclays, is expected shortly.

Merlin, which is owned by the private equity firms CVC and Blackstone, along with the original Legoland family trusts and management, is expected to have an enterprise value of around £3.5bn – of which just over £1bn is debt.

It is likely that a fairly small stake will be sold in the flotation – perhaps 20 per cent of the shares.

Merlin operates more than 70 attractions around the world, among them Alton Towers and Chessington World of Adventures. Last year it made operating profits of £258m on revenue of £1.1bn.