Lego revamps its ownership structure

Denmark's Kirk Kristiansen family, which owns Lego, is restructuring with a focus on expansion, according to news reports.

Jørgen Vig Knudstorp will step down as CEO of Lego A/S to become chairman of Lego and co-chair of an umbrella entity called the Lego Brand Group, along with fourth-generation owner Thomas Kirk Kristiansen.

Kirkbi, the Kirk Kristiansen family investment vehicle, will move into the Lego Brand Group its 75% stake in Lego; its 30% stake in Merlin, which operates Legoland theme parks; its Lego education venture; the Lego brand itself; and some support services,

a

Financial Times

report said.

Kirkbi's other holdings include investments in several large listed Danish companies and wind farms, the

FT

article said.

Knudstrorp, who has been at Lego since 2004, is credited with turning the business around; revenues have risen by an average of 17% each year since 2004, the

FT

article said. In his new role, “the power vested in Mr. Knudstorp is testament to his resurrection of the business,” the article said.

“Mr. Knudstorp said the management changes came largely at his request after he felt ‘stretched' in recent years by having to work on the boards of several Lego-related companies, as well as serving as chief executive,” the

FT

report said. The move “will free him to explore opportunities for the Lego brand outside of its current focus,” the article said.

Thomas Kirk Kristiansen succeeded his father, Kjeld Kirk Kristiansen, as vice chairman of Lego A/S and chairman of the Lego foundation in April,

a

Wall Street Journal

report noted.

Bali Padda, who had been chief operations officer, will be CEO of the toy company. Padda, a British citizen, will be the first non-Dane to lead the company since Lego was founded in 1932, the

Journal

article said.

After he stepped down as CEO in 2004, Kjeld Kirk Kristiansen acquired other family members' interests in Lego, concentrating ownership in his branch of the family, the

Journal

report noted. (Sources:

Financial Times

, Dec. 7, 2016;

Wall Street Journal

, Dec. 6, 206.)