* Looking at possible float in London, New York
* Would not float before summer, not yet appointed banks
* Operating profit rose 16.5 pct for year to Dec. 29
* Proceeds to pay down debt, fund expansion in U.S., Asia
By Kylie MacLellan and Neil Maidment
LONDON, March 27 Merlin Entertainments Group,
the private-equity backed owner of Madame Tussauds and Legoland,
is preparing to go public in either London or New York and has
been meeting with potential investors, its chief executive said
The world's second largest visitor attraction operator
behind Walt Disney, had revenue of over one billion
pounds for the year to Dec. 29 2012, and was valued at 2.25
billion pounds ($3.41 billion) in 2010 when private equity firm
CVC Capital Partners bought a stake.
"We are definitely now considering our options," Chief
Executive Nick Varney told Reuters, adding a sale would allow it
to pay down debt of 1.27 billion pounds as at the end of
December, and help fund expansion in the U.S and Asia.
The company said as part of any IPO it would consider
bringing its leverage level down below 3 times earnings before
interest, taxation, depreciation and amortisation from a current
multiple of 3.6 times.
Merlin, owned by the Danish investment company
Kirkbi A/S that controls Lego Group, and private equity firms
Blackstone Group and CVC, put off plans for a listing in
2010 due to jittery markets.
After years of subdued activity, European initial public
offerings (IPO) have picked up over the last few months as
improving stock markets boost investor confidence.
Last week, British insurer esure, estate agent
Countrywide and wind farm investment fund Greencoat UK
Wind raised a combined total of more than 1 billion
pounds ($1.52 billion) from selling their shares in London.
PREPARING THE GROUND
With the summer months being Merlin's key trading period,
Varney said the group would likely make a decision towards the
end of summer, with a float possible in late 2013 or early 2014.
"We've been putting a lot of work into preparing the ground
and making sure that if we do (IPO) ... we can move relatively
quickly and with people knowing and feeling comfortable about
what they are dealing with."
Varney said the company, which currently earns 20 percent of
its revenue in the U.S., would prefer to list in London, but was
also considering New York. He declined to comment on how much
Merlin might be worth.
Walt Disney shares trade at 16.4 times prospective earnings
Late last year Seaworld Parks and Entertainment, also backed
by U.S. private equity company Blackstone, filed with U.S.
regulators for an initial public offering.
On Wednesday Merlin reported a 16.5 percent rise in
operating profit to 258 million pounds for the year to Dec. 29,
as expansion in the U.S. and Asian markets helped mitigate the
impact of the euro zone crisis, wet weather and London Olympics.
The group opened seven new attractions in 2012, taking it to
almost 100 over four continents, and will open another six this
year including a Sea Life centre in Manchester, England and
Legoland discovery centre in New York.
A listing would likely include some new shares to help pay
down debt, but the bulk would come from existing shareholders
reducing their stakes, chief financial officer Andrew Carr said.
Kirkbi has a 36 percent stake, while Blackstone and CVC have
34 percent and 28 percent respectively.
Merlin had hired Citigroup, Goldman Sachs, Deutsche Bank,
UBS and Nomura as advisers in 2010 before abandoning its plan.
"It's good that the market seems to be opening again, it's
been closed for a long time, there does seem to be a lot of
appetite," said Varney, adding that it had not yet appointed