Birmingham NEC sold in deal 'worth around £800 million'

Birmingham's NEC group has been bought by one of the biggest investment companies in the world with the price tag rumoured to be around £800 million.

The vast NEC complex at night
The vast NEC complex at night

None of those involved in the sale will comment on the price tag but if true it dwarfs the £307 million that cash-strapped Birmingham City Council got for the exhibitions business when it was sold just three years ago.

At that time it was bought by LDC, the investment arm of Lloyds Banking Group, who have now sold it to Blackstone, a US-based investment titan with assets of around £335 billion.

The NEC is the home of Crufts dog show

Founded in 1976, the NEC has grown into the UK’s live events business of choice for organisers, exhibitors and visitors, playing host to more than seven million guests and 750 events every year.

The NEC boasts Birmingham's National Exhibition Centre, the International Convention Centre, the Genting Arena and Arena Birmingham among its assets as well as caterer Amadeus and national ticketing agency The Ticket Factory.

The National Exhibition Centre hosts many of the largest exhibitions in the UK, including Crufts dog show, Spring Fair, the UK’s largest exhibition, and Grand Designs Live.

IAAF World Indoor Championships at the Arena Birmingham in March. The NEC will host a number of events for the upcoming Commonwealth Games

Many other renowned events take place within the NEC venues and NEC has linked up with Alton Towers amusement park owners Merlin Entertainments to open their first Bear Grylls Adventure visitor attraction and a Legoland Discovery Centre on the company’s sites.

The NEC is also due to host nine sports as part of the 2022 Commonwealth Games.

LDC originally backed a management buyout of the group in January 2015. Since then, it has backed a four-year transformation programme to improve sites, facilities and the customer experience as well as widening the range of events across the group’s portfolio, supported by significant capital investment.

The Arena Birmingham venue, part of the NEC group

Paul Thandi, chief executive of the NEC Group, said: “Blackstone’s track record in scaling companies, sector knowledge and unrivalled real estate capabilities, make them the ideal new partner for NEC Group to realise the next phase of our ambitious growth strategy.

"All of our teams and partners look forward to working closely with the world class team as we embark on becoming the definitive name in events and exhibitions, while continuing to focus on innovations and new customer experience offerings for all our customer groups.”

Lionel Assant, European head of private equity at Blackstone, added: “Under the leadership of Paul Thandi, a best in class management team and the support of LDC, the NEC has transformed its main site into a leading leisure, entertainment and business destination, which continues to benefit from a diverse customer base.

"We have tremendous respect for what has been achieved; NEC Group is iconic and we are excited about our new partnership as we look to leverage our firm’s capabilities in support of the team.”

The sale follows an auction process run for LDC by Bank of America Merrill Lynch.

The sale comes hot on the heels of a year that saw top pop acts like Lady Gaga and Ed Sheeran help push sales figures at the NEC to more than £162.1 million.

Lady Gaga performing at Arena Birmingham

The group’s Genting Arena and Arena Birmingham venues also welcomed acts such as Drake, Mickey Flanagan and John Bishop, as well as welcoming back Horse of the Year Show, Disney on Ice and Strictly Come Dancing.

That took attendances to more than 1.6m in the 12 months to the end of March, up 17 per cent on the previous year. It helped push the NEC to a hike in both sales and profits ahead of a possible sale of the business.

Sales at NEC Group, which owns venues including the International Convention Centre (ICC), grew 2.8 per cent to £162.1m. Earnings were up £12m to £60m.

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