Mattel stock soars on report of Hasbro takeover offer

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Hasbro made the takeover approach in recent months, these people said, as Mattel has struggled to revive some of its faded brands. However, the terms of any possible deal were not revealed.

A new combined entity would have pricing power that it could use to negotiate with entertainment studios and over movie and television franchises.

According to a report on the WSJ, Hasbro had recently approached Mattel with the deal.

Shares of Mattel, the maker of Barbie and Hot Wheels, jumped about 24 per cent in after-hours trading. Mattel has also blamed the bankruptcy of toy retailer Toys "R" Us for its weak sales.

Mattel's market value is $5 billion after the stock plunged 47% so far this year.

Mattel in late October reported a 14% drop in its third-quarter sales, excluding the effect of currency fluctuations, and suspended its quarterly dividend. Hasbro shares were up 3.3%.

Hasbro has a market value of $11.4 billion, and its stock is up almost 18 percent this year. Mattel's stock fell to its lowest since 2009 that day.

Representatives for Hasbro and Mattel declined comment on the report, saying they don't respond to speculation. More than two decades ago, Mattel sought to take over Hasbro, but Hasbro rejected that hostile bid, saying the merger would never pass antitrust hurdles.

Mattel has not been the only target of Hasbro, which is trying to diversify its revenue stream.

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