Mattel rejects Hasbro's takeover bid: Report

Mattel has reportedly rejected a takeover offer from rival Hasbro, ending the possibility of a combination that would put Barbie and Hot Wheels under the same management as GI Joe and Nerf guns, according to Reuters.

Citing sources who could not speak on the record as negotiations are confidential, the report said Mattel has rejected Hasbro's offer.

With the rise of tech-oriented toys as also the recent bankruptcy filing by Toys R Us, toymakers like Hasbro and Mattel face many challenges.

According to Reuters, by saying no to Hasbro Mattel is looking to drive a harder bargain.

A deal would have created a toy powerhouse, uniting Hasbro's My Little Pony, Monopoly and Nerf brands with Mattel's Barbie dolls and Hot Wheels toys with the combined company having more pricing power to negotiate with entertainment studios over TV and movie franchises.

The two companies had engaged in talks several times over the years, including in 1996 and again sometime in late 2015.

Toy companies, including Hasbro and Mattel, are finding it difficult to sell toys to today's kids, many of whom would rather play with a tablet, according to commentators.

Revenue at California-based Mattel has been declining since 2013, and its stock has lost around half its value since the beginning of the year.

Rhode Island-based Hasbro has fared better after taking over the rights from Mattel for Disney's "Princess" and "Frozen" dolls in late 2014.

Mattel shares declined nearly 2 per cent in extended trading after the report and Hasbro's shares flattened after dipping over 1 per cent.