Blackstone rolls into theme parks

Hermes has made 2x cash on the £102.5m sale of Merlin as the US buyout giant takes a first step towards building a consolidated European theme park business.

Blackstone has acquired UK theme park operator Merlin Entertainments from Hermes Private Equity in a deal worth £102.5 million ($188 million; €149 million). Blackstone invested from Blackstone Capital Partners IV, its $6.45 billion 2002 buyout fund.


The US buyout firm is also reportedly a short-listed bidder for Legoland, the company that operates Lego-themed amusement parks in Denmark, Germany, England and California.


Merlin is an excellent base from which to pursue acquisition opportunities

Joseph Barratta, senior managing director, Blackstone

Merlin operates 28 attractions in Europe under brands including the UK’s Dungeon chain, the Sea Life Centre chain, and Belgium’s Earth Explorer chain. Last year the company recorded 6.3 million visitors and saw its underlying profits rise by 37 percent to £14.5 million.


Hermes acquired the company in February 2004 in a deal worth £72.5 million from Apax Partners and JP Morgan Partners. The firm is reported to be making around two times its original cash investment in 15 months of ownership.


Joseph Barratta, a senior managing director at Blackstone, said in a statement: “We believe the European attractions and theme-park sector will enter a period of consolidation in the medium term and that Merlin is an excellent base from which to pursue acquisition opportunities.”


Blackstone hopes to make a killing from London Dungeons

Blackstone is also on the shortlist for Legoland, which is believed to be worth around £250 million. Four other bidders are reportedly in the running for the European theme park operator: London-based Palamon Capital and US firms Spectrum Equity and Apollo Management.

  Dubai International Capital, which recently acquired the Tussauds Group from Charterhouse Development Capital for £800 million is also reported to be interested in acquiring Legoland.


Blackstone is currently in the market raising its latest buyout fund, which has attracted more than $12 billion of interest according to limited partner sources.