Hasbro, Mattel said to have held talks about possible merger

(Updated 1:08 and 3:11 p.m.)
Hasbro Inc. and Mattel Inc. have held talks about merging two of the world’s biggest toymakers, according to people familiar with the matter, in a deal that would bring together the owner of the My Little Pony and Furby brands with Barbie and Hot Wheels.

Hasbro approached Mattel about a potential transaction late last year, and the companies have held on-and-off talks about a deal, the people said, asking not to be identified as the situation isn’t public. Details of how a transaction might be structured couldn’t immediately be learned. The talks may not lead to a deal, the people said. Hasbro has a market value of about $9.2 billion, compared with Mattel’s $10.7 billion valuation.

Representatives for Mattel declined to comment.

“As a matter of policy we don’t comment on rumors or market speculation,” Hasbro spokeswoman Julie Duffy said.

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Mattel CEO Chris Sinclair is leading a charge to revive the El Segundo, Calif.-based company’s Barbie business, after losing market share in recent years to Europe’s biggest toymaker, Lego, as well as Hasbro’s reinvigorated My Little Pony brand. Shares surged the most in almost seven years Tuesday after holiday results topped analysts’ estimates, even as gross sales fell.

Hasbro is scheduled to report full-year earnings on Feb. 8, with revenue forecast to increase to about $4.4 billion from $4.3 billion in 2014, according to the average estimate of 12 analysts, compiled by Bloomberg. The Pawtucket, R.I.-based company holds the toy license for “Star Wars: The Force Awakens,” — a hit in theaters over the holiday season — and said in October that sales were off to a “strong start.”

Revenue at Mattel is set take another hit this year as the licensing rights to Disney’s lucrative Frozen and Princess brands shift to Hasbro.

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