Billionaire Lego fund surges on toymaker, portfolio gains

THE investment fund of the family behind Lego reported record returns last year, buoyed by higher profit at the toymaker and a stock-market boom that lifted the value of its major equity holdings.

Net income at Kirkbi Invest quadrupled to 27 billion kroner (S$5.4 billion) from 6.4 billion kroner in 2020, the Billund, Denmark-based fund said in a statement on Tuesday (Apr 19).

Kirkbi said the investment return was driven by its equity portfolio, which includes stakes in office-service company ISS and Nilfisk Holding, a maker of industrial vacuum cleaners. 

ISS gained 19 per cent last year after 3 straight years of losses, while Nilfisk surged 63 per cent, its first annual gain it was split from NKT in 2017. Kirkbi, which last week announced it will invest US$1 billion in Epic Games - the maker of the Fortnite game - is the biggest shareholder in both companies.   

The 23.3 per cent gain at the investment portfolio far outpaced the company's own target of achieving an annual return of 5-7 per cent.

The performance also outstripped losses suffered in bonds and at the unit that invests in green energy and the recycling of plastic.

That decline was largely tied to Kirkbi's investment in Quantafuel, a Norwegian company that transforms old plastic into energy and lost 47 per cent of its value in 2021.

Kirkbi also lost money on its stake in Merlin Entertainments, which operates the Legoland parks, although the deficit was smaller than in 2020, when lockdowns kept people away from the sites.

Kirkbi is chaired by Kjeld Kirk Kristiansen, the grandson of Lego's founder and one of Denmark's richest individuals, with a fortune of US$5.5 billion, according to the Bloomberg Billionaires Index.

In recent years, he has handed more control of Kirkbi to his son, Thomas Kirk Kristiansen, who like Thomas's sisters, Agnete Kirk Thinggaard and Sofie Kirk Kristiansen, has a personal fortune of about US$5.3 billion.

Lego Group, in which Kirkbi owns 75 per cent, last month reported that 2021 profit increased by 1/3 to 13.3 billion kroner. BLOOMBERG