Hasbro and Mattel are reportedly closer to creating a giant toy company

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A new report claims that Hasbro Inc. has made a takeover offer for its rival, Mattel Inc., although details surrounding the offer are now unknown.

Hasbro has made a bid to acquire its chief rival Mattel, according to people briefed on the discussions, a move that would further consolidate the world's toy industry.

CEO Margo Georgiadis, who took the reins in January, has warned the business would miss its revenue forecast for the full year.

Shares in Mattel reacted positively to the news as they shot up by 24% during Friday afterhours trading. Mattel has also blamed the bankruptcy of toy retailer Toys "R" Us for its weak sales.

Hasbro has a total market value of $11.4 billion, and its stock is up almost 18% this year. Hasbro, which makes Disney Princess Dolls and Nerf guns, rose about 3.3 per cent. Mattel's stock fell to its lowest since 2009 that day. Shares of Mattel have dropped by 47% during the year, valuing the business at just over $4.8 billion and making it a target for a takeover.

This is not the first time the two biggest USA toymakers have held talks about coming together.

Over two decades ago, Mattel tried to takeover Hasbro with Hasbro rejecting the offer. However, the terms of any possible deal were not revealed.

Hasbro ended talks to acquire USA movie studio and entertainment company Lions Gate Entertainment Corp, Reuters reported in August.

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