A consortium of long-term investors comprising KIRKBI Invest A/S (“KIRKBI”), a wholly-owned subsidiary of KIRKBI A/S, the ultimate owner of the LEGO® brand, funds managed as part of Blackstone’s long-dated “Core” private equity strategy (“Blackstone”), and Canada Pension Plan Investment Board (“CPPIB”; together, the “Consortium”1) is pleased to announce that it has agreed the terms of a recommended offer for Merlin Entertainments plc (“Merlin” or the “Company”).
1 The Consortium represents a newly formed company owned by joint offerors (i) KIRKBI Invest A/S and (ii) investment funds advised by Blackstone and CPPIB as a co-investor
2 On the basis of 1,047,557,115 issued shares and to be issued shares (on a fully diluted basis)
The recommended offer is made by the Consortium at a price of 455 pence per share in cash, for the entire issued and to be issued share capital of Merlin, other than those Merlin shares already owned by KIRKBI, which is an existing 29.58 per cent shareholder in the Company. KIRKBI has agreed to work exclusively with the other members of the Consortium in relation to the offer.
The offer will be made by a newly incorporated company which has been formed on behalf of the members of the Consortium, with each of KIRKBI and the Blackstone/CPPIB group owning 50 per cent upon completion.
The recommended offer values Merlin at approximately £4.77 billion2, providing Merlin’s shareholders with the certainty of cash at a 37 per cent premium to the closing price of 333 pence per Merlin share on 22 May 2019 (being the last business day before the publication of ValueAct Capital’s letter to the board of Merlin which suggested that Merlin should be taken private).
This is a multiple of 12.0x 2018A EBITDA3 and equates to a 31 per cent premium to the six-month VWAP4 to 22 May 2019.
The recommended offer has received irrevocable commitments in respect of an aggregate 10.0 per cent of the existing issued ordinary share capital of Merlin, and 14.2 per cent of Merlin shares being eligible to vote in favour of the recommended offer, including from ValueAct Capital.
KIRKBI has maintained a significant strategic shareholding in Merlin since the sale of LEGOLAND® Parks to the Company in 2005.
KIRKBI and Blackstone private equity funds jointly controlled Merlin in the 8 years prior to the 2013 public listing, during which time the Company became the second largest visitors attraction business globally and the partner of choice for the world’s leading brands to deliver immersive experiences to guests.
The Consortium recognises that significant, long-term investment is required to ensure the longevity of the existing assets and to drive continued growth for the Company and its stakeholders.
Source : Joint release ( abstract)