Barbie meets Bob as Mattel seals $680m deal

Bob the Builder and Thomas the Tank Engine have made new friends with Barbie after Mattel, the world's biggest toy-maker, acquired Hit Entertainment for $680m (£427m) in cash.

Mattel, which also operates Fisher-Price toys, has agreed a deal to buy Hit Entertainment and its intellectual property and marketing rights from a private equity fund led by Apax Partners, following a protracted auction that kicked off in March.

The price paid by Mattel falls way below the reported valuation of Hit when details of the auction process first emerged last year. Indeed, Apax bought the operator of the pre-school brands in a deal worth £490m in 2005, which would have equated to nearly $900m at that time.