Lego Owner, Blackstone to Buy Madame Tussauds


Asia

Madame Tussauds unveils its new figure of Ed Sheeran in Shoreditch, London, in June 2018.


Photo:

Matt Crossick/Zuma Press

The family behind toy giant Lego A/S is teaming up with

Blackstone Group


BX0.29%

LP and a Canadian pension fund to buy the owner ofMadame Tussauds wax museumsand Legoland theme parks in a deal that values the company at £4.77 billion ($6.04 billion).

Merlin Entertainments


MERL13.90%

PLC, the world’s second-largest visitor-attraction operator after

Walt Disney
Co.

, said Friday it had agreed to be bought by a consortium of Kirkbi—which controls Lego—U.S. private-equity group Blackstone and Canada’s CPPIB.

The British company operates 130 attractions in 25 countries, including several Legoland Discovery Centers and Sea Life aquariums in the U.S. and a string of stand-alone theme parks in Europe. Last year, it attracted 67 million visitors and reported revenue of £1.65 billion. It employs about 28,000 people in peak season.

Kirkbi, the investment vehicle of Denmark’s Kirk Kristiansen family and the owner of 75% of Lego, said buying Merlin would allow the two companies to work more closely together on product and brand development. It also said it planned to invest more in Legoland parks, which are themed around the world’s best-selling toy brand.

In recent years, Merlin has expanded by opening more attractions in Asia and North America, and developing its parks into resorts by adding accommodation.

Kirkbi already owns nearly 30% of Merlin, having held a stake since selling the company its Legoland parks in 2005. After the takeover it will own a 50% stake in the business, with Blackstone and CPPIB owning the other half. Given Kirkbi’s existing stake, the consortium is paying about £3.35 billion for the rest of the company.

The deal, one of the largest acquisitions of a U.K.-listed business this year, comes weeks after U.S. activist investor ValueAct Capital urged Merlin to seek a deal to go private. It said Merlin’s share price undervalued the company and that it would be easier to make necessary long-term investments away from public scrutiny. ValueAct owns about 9.3% of Merlin and has pledged to support the deal.

The 455-pence-a-share offer represents a 37% premium to Merlin’s share price the day before ValueAct’s letter to the board was published, and a 15% premium to Merlin’s closing price Thursday.

Shares in Merlin were 14% higher in London midday trading Friday.

Merlin had been jointly controlled by Kirkbi and Blackstone for about eight years before it wasfloated on the London Stock Exchangein late 2013. Since then Merlin has grown revenue and profit but its shares have fallen in the past couple of years partly because of concerns about rising costs.

Write toPeter Stiff at[email protected]

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