Case Summaries · Stressed credits

Merlin Entertainments: the £657m refinancing of the 2027 notes

Merlin has lined up £657m of new secured loans, reportedly led by Monarch and GoldenTree, to take out its 2027 unsecured notes. The new money ranks pari with about £3.2bn of existing secured debt and also gets priority liens over four London attractions. No redemption notice on the 2027s had been published as of 3 October.

By EURx · 3 October 2026 · Thread on X

Revenue and visitors fell in FY25 and the group posted an operating loss

Merlin's own FY25 release shows revenue of £1,999m against £2,057m in FY24 and 60.5m visitors against 62.8m. Underlying EBITDA was £571m (FY24 £573m), with second-half EBITDA up 6.5%. Management called it a “transitional year”.¹ On a reported basis the group made an operating loss of £58m.²

The 2027 unsecured notes set the clock for the secured debt

The notes due November 2027 sit below roughly £3.2bn of senior secured debt, which includes about $2.5bn of term loans due 2029.³¹³ The secured debt has a springing maturity tied to the 2027s: if the unsecured notes are not refinanced or extended, the secured maturities move forward.⁴ Something had to be done about the 2027s well ahead of November 2027.

The table lists the instruments named in the reporting cited here. It is not the full capital structure.

The stress showed up in the bonds a year before the deal

In October 2025 the FT ran “Blackstone-backed theme park giant under pressure after debt sell-off”.⁵ Merlin then sold the LEGO Discovery Centres to the LEGO Group for about £200m, completing on 27 February 2026.⁶ That helped, but it was well short of the roughly £627m of notes due in 2027.

Merlin fielded refinancing pitches over the summer

9fin reported on 24 August that “Merlin Entertainments fields pitches from firms eyeing 2027 debt maturity”.⁷ In July CreditSights set out the options open to the company, including new debt that would prime the existing secured notes.⁴ 9fin also reported that CLOs held a large share of the euro 2027s.⁸

The new loans are secured on four London attractions

Sky News reported a refinancing of about £650m on 8 September.⁹ On 10 September Merlin told creditors it had lined up £657m of new loans.¹⁰ 9fin named Monarch and GoldenTree as the leads.¹¹ The collateral package is the London Eye, Sea Life London, Shrek’s Adventure! London and the UK Dungeons.¹²

The new loans rank pari with the existing £3.2bn of secured debt and also take priority liens over those UK assets.¹³

Existing secured lenders took the hit

S&P put Merlin’s B- secured ratings on CreditWatch Negative, and Moody’s cut the term loans to Caa2, citing lower recoveries for existing secured lenders.¹³ The secured bonds rallied on the news and then gave it back: the €700m June 2030 notes were around 69.3 on 28 September, about 12 points below where they traded before the deal. Ben Pakenham of Polen told Bloomberg: “The new financing hasn’t dealt with the underlying problems which are cash flow and operating performance.”¹³

The euro 2027s are trading just below par

The € 4.5% 2027s were around 99 as of Friday 2 October. Deutsche Börse showed 97.63 bid and 99.71 ask at the close that day.¹⁴ We don’t read that as doubt about the deal closing. It looks more like holders moving on from the trade and rotating into the secured paper or other names. A material drift away from par would be worth watching.

Next up is the redemption notice and then the 2029 term loans

We are watching TISE for a redemption notice on both series of Motion Bondco notes.³ After that the focus moves to the roughly $2.5bn of term loans due 2029. Ironshield told Bloomberg a straightforward refinancing looks unlikely and that even an amend and extend could be hard.¹³

Sources

Company figures come from Merlin’s own results release. There is no court process here, so the deal terms, lenders and pricing come from press and research reporting, which is cited for each point. We have not used any non-public material.

1. Merlin Entertainments, FY2025 results release, March 2026 link
2. RideRater, report on Merlin's FY2025 operating loss link
3. TISE, Motion Bondco DAC listing link
4. CreditSights, Merlin liability management playbook, 27 July 2026 link
5. Financial Times, 24 October 2025 link
6. Merlin Entertainments news release on completion of the LEGO Discovery Centres sale, 27 February 2026
7. 9fin, 24 August 2026 link
8. 9fin, CLO holdings of the 2027 notes link
9. Sky News report of 8 September 2026, via UK Theme Park Spy link
10. Bloomberg, 10 September 2026 link
11. 9fin, GoldenTree and Monarch lead the refinancing link
12. Irish Independent (Bloomberg) on the collateral link
13. Bloomberg, 28 September 2026 link
14. Deutsche Börse, Motion Bondco 4.5% 2027 quote page (XS2064643484) link