According to sources, Blackstone is considering selling the $2.6 billion event group Clarion

By Amy-Jo Crowley and Emma-Victoria Farr

LONDON/FRANKFURT (Reuters) – Blackstone Group is exploring options for Clarion Events, including a sale that could value the company at up to 2 billion pounds ($2.6 billion), three people familiar with the matter told Reuters, as demand from event organizers continues to recover after the pandemic.

The U.S. buyout group has held informal talks in recent months with private equity funds such as CVC and KKR that may be interested in buying the London-based company, said the people, who spoke on condition of anonymity.

Preparations are still in the early stages and Blackstone may not begin an auction process until early next year, the people said, but they cautioned that no final decision had been made and no financial adviser had been appointed.

Representatives for Blackstone, Clarion and KKR declined to comment. CVC did not immediately respond to requests for comment.

Blackstone acquired Clarion Events in a £600 million deal in 2017. The firm supported the company during the COVID-19 pandemic when the events industry suddenly came to a halt, severely impacting the company’s revenue and profits.

Clarion, which organises the London International Horse Show among other things, saw revenue jump to £432.9 million in the 12 months to January from £257 million a year earlier as the industry returned to normal in China and Hong Kong, according to the latest available results.

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Dealmaking in the events sector is picking up as companies return to in-person conferences and exhibitions. Expectations that interest rates in the U.S. will fall next year are encouraging private equity firms to invest as debt becomes cheaper, the first person said.

Informa, the British events and science publishing group, agreed in July to buy Ascential, the organiser of the Cannes Lions advertising festival, for £1.2 billion. In addition, Inflexion and Copeba agreed earlier this year to invest in Belgian events group Easyfairs.

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Clarion is expected to post core earnings, or EBITDA, of around £145 million this year and could fetch 14 to 15 times that amount, or more than £2 billion, if sold, the first person said.

Under Blackstone’s ownership, Clarion has expanded its operations outside Europe, partly through acquisitions. The company merged with Asian exhibition organizer Global Source in 2018 and bought the US-based Global Gaming Business earlier this year.

According to the results, Asia and the US are Clarion’s largest markets, accounting for 36% and 35% of sales respectively, followed by Europe (including the UK).

Led by CEO and event veteran Lisa Hannant, Clarion produces events across a variety of industries, including electronics, gaming, energy, security and defense, public safety and technology. The company was founded in 1947 and says it employs more than 1,900 people in 13 countries.

(1 USD = 0.7816 pounds)

(Reporting by Amy-Jo Crowley and Emma-Victoria Farr; Editing by Elisa Martinuzzi and David Holmes)