By:Howard French , Journal Inquirer
Lego Systems Inc. has sold its Enfield buildings and leased back space in some of them for its operations, which are the Danish toymaker's North American headquarters, company spokesman Michael McNally said today.
McNally declined to identify the buyer or to disclose any details of the transaction.
But Enfield Town Clerk Suzanne Olechnicki said today that land records identify the buyer as Equity Industrial Enfield Limited Partnership, based in Needham, Mass. The partnership paid $58,880,848 for the buildings in the transaction, which took place Thursday.
"The buildings were recently sold, and we have entered into a long-term lease on those we will continue to occupy, which are Compass House on Taylor Road and the small building on Print Shop Road," McNally said. "The Lego Creative Childcare Center will remain in the small building at the corner of Moody and Taylor roads.
"We are very happy to have found a buyer who was amenable to our desire to remain at our campus in Enfield," he said.
Lego in June announced that it would sell its Enfield buildings and lay off nearly 300 of its Enfield workers - roughly 44 percent - through March of this year. Lego also said it will close its Enfield packaging operation and subcontract all warehousing, packaging, and distribution to an international company based in Singapore.
Cuts at its headquarters in Denmark will be even larger, with 75 percent of the 1,200 employees there expected to lose their jobs in 2007, the company announced.
The layoff decision was part of the company's ongoing efforts to slash business costs, Lego officials said.
The action will result in the layoff of as many as 290 of the Enfield operation's 650 employees, according to Lego officials, who said that all workers let go will be paid regular wages through the end of March. They also will be given a severance package including a lump-sum payment based on the number of years employed, company officials said.
Included in the sale were the distribution center and manufacturing plant. All of the warehousing and packing work previously done in Enfield has been subcontracted to Flextronics Corp., which will handle the work at its plant in Juarez, Mexico, according to Lego's announcement in June.
Distribution of North American products also has been subcontracted to Exel Inc., a wholly-owned entity of Germany's Deutsche Post World Net. Under terms of the deal, Lego products will be distributed from Exel's new warehouse in Alliance, Texas, in the Dallas-Fort Worth area, which is to open this month. Full distribution of Lego products will start in April.
Also, Lego's direct-to-consumer sales division announced a partnership with PFSweb Inc. to fill Internet orders of Lego products from its catalog and online store, according to a statement in December from Lego Systems President Soren Torp Laursen.
Beginning in April, Lego orders will be fulfilled from the company's warehouse in Memphis, Tenn.
Financial terms of the deal were not disclosed.
The Enfield changes also are part of the company's overall supply chain plan announced in late 2004 Since the 2004 announcement, the company has closed and moved its plant in Switzerland to its factory in the Czech Republic.
At its headquarters in Billund, Denmark, Lego also has said that it plans to gradually shift production to Flextronics' plants in eastern Europe over the next three years, affecting up to 900 of the 1,200 current production jobs in Denmark.
In addition, Flextronics took over operations at the Lego factory in the Czech Republic in August, company officials said.
Lego ended all manufacturing at its Enfield plant in 2000, farming that work out to its plants overseas, leaving only the North American headquarters corporate functions in Enfield, along with the packing and distribution work that has now been ended as well.
Once the layoffs are completed in March, the Enfield work force will total about 360, according to McNally.
Lego also has announced plans to close its existing five distribution centers in Denmark, Germany, and France, which will mean an additional 213 Lego job cuts.
For more info about the company who will be running LEGO's online store in 2007 check out - http://digital50.com...-to-consum.html
More info about the company who will be making the actual LEGO bricks in 2007 visit- http://www.flextroni...53/Default.aspx