February 11, 2010 4:45 pm

Merlin puts £2bn flotation plans on hold

Merlin Entertainments, the Blackstone-owned theme park operator, is putting on hold plans for a £2bn flotation blaming market volatility, although it insists it has not abandoned the option of a listing.

Following the decision by Travelport, the US travel services company also owned by the private equity group, to pull its planned £1.2bn initial public offering, Merlin issued a statement saying all options, “including an IPO”, remained viable.

However, people close to the situation said that the volatile financial climate made it difficult to press on with flotation plans at this stage.

“We are probably not going quite as fast as possible,” one person said.

Nick Varney, Merlin chief executive, told the Financial Times that no flotation had been pulled, since none had been announced.

“The IPO remains as strong a proposition for ownership structure as before,” he said.

Merlin and its owners Blackstone had for some time made clear that an IPO was an aspiration, Mr Varney added. “It remains one of the strong considerations that we have. I don’t see, with a company that’s performing strongly, why that option will have gone away.”

Regarding market conditions, Mr Varney said: “We are constantly evaluating what’s going on. We look a tissues that are market-specific and company-specific.

“We are not over-levered, we are not under pressure to do anything on financing.”

Merlin, whose assets include Madame Tussauds, Legoland, and the London Eye, took on Sir John Sutherland as chairman at the end of last year and had recruited a number of banks for advice on flotation.

Sir John said in a statement: “We continue to consider and debate the options for our future ownership structure. All options, including an IPO, remain under consideration.”

The IPO option was “still a frontrunner”, said one person close to the situation.

Merlin also said it had appointed Charles Gurassa, chairman of Phones 4U and former chief executive of Tui Group, as a non-executive director.

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