Dubai group buys stake in London Eye

The company hoping to take control of the London Eye was today sold to Middle Eastern investors, further complicating tortuous negotiations to safeguard the wheel's financial future.

Tussauds Group, which also owns Madame Tussauds, Alton Towers and Chessington World of Adventures, has been bought for ?800million by an investment fund controlled by the government of Dubai.

The sale comes as Tussauds tries to take over the Eye from its other co-owners, including the husband-and-wife architect team and British Airways.

BA is thought to be a willing seller, although the architects are reluctant to surrender

control.

They have accused Tussauds of blocking a deal which would extract the company from the massive interest repayments it has to pay BA, which fronted the cash to build the Eye for the millennium.

Tussauds, which already runs the wheel day-to-day, wants to take full operational control in return for buying out the other investors.

Its venture capitalist owner, Charterhouse Capital

Partners, is selling the business in a deal that means a ?30million windfall for 70 top managers, who will remain at the company.

Charterhouse bought the company in 1998 from Financial Times owner Pearson. Chief executive Peter Phillipson and finance director Rob Roger are likely to pocket millions from the deal after getting the business into shape.