Having purchased the Tussauds group in 2005 for £800 million, the investment group Dubai International Capital have agreed to sell it to Merlin Entertainments for £1 billion. DIC will retain a 20 per cent stake in the combined company. Merlin itself is owned by the US private equity group Blackstone, the second largest attractions operator in the world after Disney.
Merlin’s Chief Executive Nick Varney said:
“The combination of the Merlin and Tussauds brands, people and operating expertise will create an exciting and world-beating global company. With such iconic brands, the expanded Merlin will not only have strong development potential, but also an amazingly robust and high value portfolio.
“Our ambition is to build on this to become the world leader in location-based, branded family entertainment.”
The Tussauds Group currently consists of Alton Towers, Chessington World of Adventures, Thorpe Park, Heide Park, Warwick Castle, The London Eye and 5 Madame Tussauds Wax Works around the globe. This is added to Merlin’s brands of The Dungeons, the Sea Life Centres and Legoland.
John Lord, an expert in the leisure industry at the University of Wales, saw a number of factors behind the growth in leisure attractions:
“We perhaps go out more as a family than we did in the past and we are more mobile. That means resorts can be developed on out-of-town sites without needing to worry about being close to town or to bus stops and train stations. Increased leisure time and wealth are also playing their part. These attractions are getting ever more expensive … but that doesn’t seem to put people off.”
Interesting… That’s not exactly the more negative view of Southport’s Pleasureland after it closed last year:
“It must be acknowledged that the UK theme park industry as a whole is facing increased competition from publicly-funded and lottery-funded attractions which have significantly distorted the visitor attractions market. This situation has been compounded by our weekend trading now competing with extended Sunday shopping rules and Sunday sporting events.”
(See my blog New Season, Renewed Optimism).
It seems a case of the rich getting richer and the poor getting poorer after last year’s closure of a number of UK theme parks. The financial power of the bigger groups is now squeezing out smaller competition. This acquisition is likely to push forward more investment in some of the UK’s most popular attractions, but could potentially put even more financial pressure on smaller theme parks and leisure companies.
