LONDON (Reuters) - Private equity firm CVC is in talks to take a 30 percent stake in the owner of Britain’s Alton Towers theme park as rival Blackstone looks to reduce its stake in the business, sources familiar with the process said.
A deal would value Merlin Entertainments at about 2.5 billion pounds ($3.71 billion), one of the sources said, with CVC Capital Partners, Blackstone and Kirkbi A/S — the Danish investment company owned by the family behind the Lego brand — owning about 30 percent of the business each.
Management will own the remaining portion, while Dubai International Capital, which reduced its stake earlier this year from about 16.5 percent to single digits will fully exit the business that counts Madame Tussauds and Legoland among its attractions, sources said.
The private equity firms declined to comment, while a spokesperson for Kirkbi said it was company policy never to comment on market rumors.
“But I can confirm that we remain committed to the investment in the long term and have no plans to reduce our ownership share,” the Kirkbi spokesperson said.
Kirkbi owns about 36 percent of the business, while Blackstone owns some 52 percent. A deal with CVC would allow the U.S. buyout firm to sell part of its stake and return cash to its investors.
Merlin had been considering an initial public offering (IPO) late last year, pulling in Citigroup, Goldman Sachs, Deutsche Bank, UBS and Normura to advise on a float.
But plans never got off the ground as market jitters derailed a number of nascent offerings earlier this year, including Blackstone’s travel services group Travelport.
Merlin has grown into the second largest theme park operator behind Disney during Blackstone’s ownership.
Additional reporting by Peter Levring in Copenhagen; Editing by Louise Heavens