Mattel, maker of the Barbie doll, the world's most popular toy with sales worth more than dollars 1bn a year, half of the company's total revenues, is based in California. The group, says Jon Salisbury, editor of World Toy News, is 'very West Coast, very brash, always going for upside (broke).'
In contrast, Fisher Price, the pre- school toy maker based in New York, is a worthy, East Coast, hometown company. It invites children back to a 'play laboratory', where toddlers test toys under the watchful eye of child psychologists.
Nevertheless the two companies are determined to get along. The reason is simple.
The deal brings Mattel, already the world's second-largest toymaker, within touching distance of Hasbro, the number one manufacturer with a range that includes Sindy and the Jurassic Park spin-offs.
Last year Mattel's sales were dollars 1.85bn and Fisher Price's dollars 694bn; a combined total that will place them neck-and-neck with Hasbro's pounds 2.5bn.
The merger will open up a big gap between the top two and the rest in the dollars 40bn global toy industry. Third- placed Lego, the privately owned Danish company, has sales thought to be close to dollars 1bn and Tyco, the American company that bought Matchbox last year, is around the same level.
The deal will bring Mattel a stronger presence in the pre-school sector in which Fisher Price has a reputation for quality, safety and long-term successful products. 'The stable, quality image with parents is very attractive to us,' a Mattel spokesman said.
With Fisher Price it will be in a stronger position to attack Hasbro's Playskool range. Fisher Price will benefit from Mattel's superior distribution and marketing clout.
'The combination will produce a leading toy company that has the strongest consumer brands by far in the industry,' John Amerman, Mattel's chairman and chief executive, said.
Under the deal, each share of Fisher Price common stock will be exchanged for 1.275 shares in Mattel. The merger will need government and shareholder approval but is expected to be completed by December.
Mattel said there would be redundancies but not in marketing or product development. Fisher Price will retain its headquarters in East Aurora, New York.
Some industry observers feel the merger might nudge Hasbro into takeover action.
But Angus Fisher, managing director of Britain's Bluebird Toys, played down the implications of the merger. 'I think this is a good deal for Mattel but I don't think it will affect anyone in this country very much,' he said.
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