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Lego family leads $6 billion deal to take Madame Tussauds owner private

Posted at 4:31 AM, Jun 28, 2019
and last updated 2019-06-28 10:33:58-04

The Danish family behind Lego has partnered with Blackstone to take the owner of Madame Tussauds private.

The deal values Merlin Entertainments at £4.7 billion ($6 billion). In addition to the wax museum Madame Tussauds, the company owns LegoLand theme parks and other attractions in 25 countries, including The London Eye.

Merlin said Friday that it had agreed to be purchased by a consortium made up of Kirkbi, the investment house of Lego’s founding family, US private equity giant Blackstone and Canadian pension fund CPPIB.

The consortium will pay £4.55 ($5.75) per share for Merlin Entertainments, a 14% premium over the stock’s closing price on Thursday. Including debt, the deal values the company at nearly £6 billion ($7.6 billion). The shares traded at £4.50 ($5.70) on Friday.

The offer for the entertainment company comes a month after US activist investor ValueAct Capital went public with a recommendation that it go private following “years of continued share price underperformance.”

“Private ownership is simply better placed than current public shareholders to underwrite the investments Merlin must make,” ValueAct Capital, which had a 9% stake in the firm, wrote in an open letter in May.

The company’s board said in response that it was fully confident in its strategy.

Yet in going private, Merlin Entertainments is returning to its roots. It was owned by Kirkbi and Blackstone before listing on the London Stock Exchange in 2013. The Lego family retained a roughly 30% stake after the IPO.

Merlin’s stock performance was volatile, however, as terror attacks in the United Kingdom dented visitor numbers at some of its attractions in recent years.