PROFILE
were betting the company every year on the success of the new ventures. However, the investment model had been tried and tested by this stage and the business now fully understood the way to ensure good financial returns.
Going global In 2005 management were drawing up a much more ambitious plan to create a global player. This plan involved bring- ing together midway and destination attractions to give a diversified portfo- lio of brands and formats to create a global platform. To achieve this plan, much deeper pockets were required, as the plan envisaged acquiring larger businesses such as Legoland (which was on the market) and The Tussauds Group. One financier interested in this type of ambition was Blackstone, one of the largest private equity firms in the world and the Merlin management team approached them with their expansion plans. The expansion of private equity in the 80s and 90s had created an elite tier of fund managers whose excellent investment track record had enabled them to raise ever increasing funds. Blackstone started with $400,000 (£242,000, €293,000) in 1985 and now has circa $250bn (£151bn, €183bn) under management. With funds of this size, fund managers proactively research markets to see if they can bring together a number of players to create a more powerful, market leading business.
BRAND PORTFOLIO
MIDWAY ■■Madame Tussauds (15) ■ ■ The EDF Energy London Eye ■■ Sydney Tower Eye including 4D cinema and SKYWALK ■■Blackpool Tower ■ ■Weymouth Tower ■■ Dungeons (8) ■ ■ LEGOLAND Discovery Centres (10) ■ ■ No 1 global aquarium brand - SEA LIFE (45, excluding those linked to theme parks) These include: Underwater World (Queensland); WILD LIFE Sydney Zoo; Manly SEA LIFE Sanctuary, Sydney; WILD LIFE Hamilton Island, Queensland; Kelly Tarlton’s SEA LIFE Aquarium, Auckland, NZ; Busan Aquarium (South Korea); Siam Ocean World (Bangkok); Chang Feng Ocean World (Shanghai); Turkuazoo Aquarium, Istanbul, Turkey
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Merlin’s midway brands, such as The Dungeons (above), will be further rolled out globally Things now moved fast, with
Blackstone acquiring Merlin for £102m ($165m, €121m) in early 2005 giving Hermes a substantial profit in a relatively short period of time. Blackstone then funded the acquisitions of Legoland at a price of €375m (£309m, $512m) and Gardaland at €470m (£387m, $642m). The profitability of these assets was
significantly improved on acquisition, maintaining the momentum of the rapidly growing business. The family fund behind Lego retained an investment, but the new capital was from Blackstone and from the debt markets – and soon there was a new opportunity which was to double the size of the company. And that opportunity was The Tussauds Group.
■■2 Ski Resorts (Mount Hotham, Falls Creek) and 2 Fly Treetop Adventures (Otway, Illawarra) in Australia
LEGOLAND Resort Theme Parks Denmark, UK, Germany, California, Florida and Malaysia. Many with hotels, holiday villages and waterparks
RESORT THEME PARKS ■■ Gardaland, Italy’s number one theme park, including hotel and SEA LIFE ■ ■ Gardaland Aquapark, Milan ■■ Alton Towers Resort, UK, including two hotels and an indoor waterpark ■■ Thorpe Park ■ ■ Chessington World of Adventures, including hotel ■■ Heide Park Resort, Germany, including hotel and holiday village ■ ■Warwick Castle, UK
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Earlier – in 18th century France Marie Tussaud was an artist who lived during the French Revolution, who had a talent for making waxworks. She started touring with her waxwork collection in the early 1800s, finding a permanent home for it in London’s Baker St in 1835. That was largely that for another 143 years until the business was acquired by S Pearson and Son (listed as Pearson plc), an engineering company that built the Blackwall Tunnel and then diversified into media. Pearson also owned Chessington and during its 20 years’ of ownership added Warwick Castle, Alton Towers and Thorpe Park to the portfolio. Tussaud’s was sold to Charterhouse
Development Capital (CDC) for £352m ($582m, €427m) in 1998. The company raised £200m ($331m, €242m) through a bond issue and overall a further £300m ($496m, €363m) was invested in improving the product, supporting the London Eye and acquiring Heide
AM 1 2014 ©Cybertrek 2014
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