Europe's largest theme park operator and owner of Madame Tussauds wax museums Merlin Entertainment Group Ltd is set to launch a £3-bn initial public offering in London, the largest so far this year in Europe, London's The Sunday Times reported yesterday.
Global banking giants Barclays, Citi, Goldman Sachs and Morgan Stanley are all reported to have been appointed to advise on the listing of Merlin's shares by the company's board and private equity backers, although it is not certain who will take the position of lead manager.
Merlin is owned by leading global private equity firms Blackstone and CVC Capital Partners and also Kirki, a Danish family investment group behind the Lego entertainment business.
The exact timing of the public issue has not been decided, but it is expected that the mega issue could take place as early as in the fourth quarter this year.
According to insiders, the decision to list in London is still not final. Merlin's chief executive Nick Varney had hinted earlier March that the company is considering a London public issue, but other options also remains open.
Blackstone group, which also owns Seaworld Entertainment Inc, another theme park company in the US, has recently given indication about a US public issue for that company.
If the issue progresses, Blackstone, an investor in Merlin since 2005, and CVC are likely to sell major chunks of their holdings.
According to some analysts, Merlin is expected to be valued up to £4 billion when it comes to the market, and the company could make an entry straight into the FTSE 100 index.
Poole, England-based Merlin is the world's second-largest operator of amusement parks after Walt Disney Parks and Resorts. The group runs 94 attractions in 21 countries including US, Japan, South Korea, China, Hong Kong, New Zealand, Australia, Thailand and other places.
It has over 46 million annual visitors and employs around 21,000 people.
The company's theme park resorts include England's Alton Towers, Italy's Gardaland and Germany's Heide Park. It runs the prestigious Madame Tussauds wax museums and Sea Life Centres in several places across the globe and also Legoland parks in diverse locations.
Merlin, formed in 1999, has expanded its global footprint in recent years with strong growth in Asia and the US. According to some estimates, the group's sales have jumped more than 10 per cent to £1 billion last year, with operating profit of around £260 million.
The European IPO market that was subdued due to high market volatility and weak economic growth is likely to make a recovery in the current year.
Last month, in an interview with CNBC, CEO of the London Stock Exchange Xavier Rolet said that IPO activity in Europe is picking up and will drive economic recovery across the region.
"But I think we're at the lows and the prognosis particularly for primary markets – what you'd describe as the IPO market - is very good. The pipeline is, in fact, outstanding, as has the performance been in the last 12 months," he said.