British Airways is to sell its stake in the London Eye to the Tussauds Group, but the attraction will continue to bear the airline's name, it was announced on Thursday.
British Airways and The Tussauds Group have signed a memorandum of understanding which paves the way towards securing the long term future of the South Bank attraction.
British Airways will sell its entire interests in the Eye including its one third share and its outstanding loan to the company for Ł95 million. The airline plans to continue its brand association with the attraction by extending its franchise agreement.
"I am delighted that we have reached an agreement that paves the way towards securing the future of the Eye for generations to come," said Martin George, the airline's commercial director. "British Airways has supported the Eye for nearly a decade and will continue to do so with the extension of its franchise agreement.
â€śThe deal will also enable us to continue to strengthen our balance sheet and focus on our core business.
â€śTussauds has proven experience as the operator of the Eye and since its launch in 2000 has helped make the Eye the most popular paid for attraction in London. The company is committed to the future development and success of the Eye for the benefit of the consumer and London's Ł6.6 billion tourism industry.â€ť
The news has been welcomed by the South Bank Centre, who have been locked in a legal tussle with the London Eye Company in recent months. Chairman Lord Hollick said: "This is good news for the Eye and the South Bank. A new long-term lease on fair commercial terms has been agreed in principle between the Eye and the South Bank Centre. The South Bank Centre warmly welcomes the Tussauds Group as a major partner in the transformation and development of the South Bank."
Peter Phillipson, chief executive of The Tussauds Group said: â€śIt has been everyone's objective to create a financially secure and long-term future for the London Eye and this deal will achieve this.
â€śWe believe that we have the operational experience through our city centre attractions such as Madame Tussauds; theme parks like Thorpe Park; and national historic treasures like Warwick Castle to continue to develop The Eye as an icon that London and Londoners can remain proud of.
â€śWe are extremely excited about the prospect of taking the Eye forward and developing this great cultural attraction. We plan to invest Ł50 million in the attraction over the next five years.â€ť
The London Eye Company currently has three equal shareholders: British Airways, The Tussauds Group and Marks Barfield Architects.