Financially troubled Danish toy maker Lego Holding is about to sell four of the biggest bricks in its empire -- its Legoland theme parks.
Blackstone Group, a New York-based private equity firm, is close to an agreement to buy Lego’s family entertainment parks, including one in Carlsbad in San Diego County. The deal would be valued at about $461 million, according to sources close to the deal cited by the Wall Street Journal on Tuesday.
The Kristiansen family, which founded the company and still controls it, is expected to keep a 10% to 15% share of the theme park business, the report said.
Blackstone spokesman John Ford declined to comment on the reported deal and a Lego representative didn’t return calls.
Lego put its four theme parks on the block earlier this year in an urgent effort to garner some liquidity after suffering a record loss in its toy business. Last year, Lego had a net loss of about $335 million as its toy sales declined in the face of growing competition from China.
The company also faced heavy restructuring and write-down costs.
Blackstone, which has raised almost $6 billion for real estate investments in North America and Europe, is not a stranger to the theme park business.
Blackstone owns a half interest in the operation of Universal Studios Orlando and, just last month, it bought London-based Merlin Entertainments for $187 million. Merlin operates 28 tourist attractions in eight European countries under the Dungeons, Sea Life, Seal Sanctuary and Earth Explorer brands.
The Legolands in Carlsbad, Denmark, England and Germany attract more than 5 million visitors a year.
The parks feature massive sculptures made of the company’s signature Lego bricks along with such traditional theme park fare as roller coasters, water rides and live-action performances.
Leisure industry consultant Bob Rogers of Burbank-based BRC Imagination Arts called the pending deal “a head scratcher” because most entertainment companies would be loath to give up the real estate that supports their intellectual properties.
“Legoland sells Lego,” said Rogers, meaning that the parks build brand awareness. “If they view it as just an amusement park then they may be missing a lot of value to the company.”