#53 Transnational Takeover Alert: Lionel – Maerklin
Last year Maerklin, German manufacturer of high quality toy trains slipped into bankruptcy. As the Financial Times Germany reports, former US rival and market leader in the United States, Lionel has shown keen interest in acquiring the ailing German company. While there seemed to be tangible urgency to find a new owner originally, 2009 has been a surprisingly good year that renders smaller Lionel’s (sales 2009 about US$ 80 mio) offer just not good enough. With about EUR 110 mio in sales last year, Maerklin made it back into the profit zone and is flush with cash. It may have become more attractive for other investors which supposedly include Sun Capital. Ironically, Lionel has been through a bankruptcy itself in 2007 when it was snatched up by investment bank Guggenheim Partners.
March 9, 2025 @ 9:31 pm
Now, more than 14 years later, it is interesting to evaluate the situation of Märklin and Lionel LLC again.
In 2013, toy manufacturer Simba-Dickie bought Märklin, restructured the company and made it profitable again. Simba-Dickie, a Germany-based company, offered employees workplace guarantees in exchange for reduced salaries, which helped lower costs. Furthermore, the product portfolio has been modernized. Since the take-over the company has experienced increasing turnover, and the pandemic years led to a surge in interest in toy trains. In 2021/22, Märklin’s turnover was €131.4 million.
Lionel LLC recovered and remains an active player in the U.S. market. In 2024, its turnover was $92.1 million—significantly lower than Märklin’s.
Märklin serves as a valuable example of how an old company (it has been founded in 1859) can survive in the business world if properly restructured and positioned in the market. From today’s perspective, Lionel LLC acquiring Märklin in 2009 would have been a good deal for them.
Sources:
https://www.sueddeutsche.de/wirtschaft/maerklin-modelleisenbahn-corona-1.5182856