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in the market. Also, from Table 1 it is clear that the video game industry is growing more than
…ve times as much as the traditional toy industry.
Insert Table 1 around here
From Babitch et al. (2006), Mattel’s main competitors in 2006 were: Hasbro, Leapfrog, Jakks
Paci…c and Radica Games. Mattel is the market leader followed by Hasbro, which has taken a
strategic decision to go after the electronic toys segment. For the rest of the market, Leapfrog
had focused its e¤orts to serve the educational product market; both Jakks and Radica have, from
inception, been more involved in the development of specialized electronic games, Jakks’ main
target segment is video games for TV and other platforms. Table 2 show the market capitalization
of these companies as for the year 2006.
Insert Table 2 around here
It is clear from Figure 3 and the discussion above that Mattel enjoys a very strong position
in the non-electronic toy segment. Its market capitalization is more than double the market
capitalization of its closer competitor.
3.1 Mattel-Radica acquisition
Mattel is the worldwide leader in the design, manufacturing and marketing of toys and family
products including Barbie, Hot Wheels, Matchbox, American Girl, Fisher-Price and many other
famous brand names in the toy industry. Mattel employs 25.000 people in 42 countries and sell its
product in more than 150 countries around the world.
Although Mattel has enjoy a strong position in the toy industry 5 , it is conscious of the growing
5 The market leadership of Mattel is based fundamentally in the segment of traditional toys for children age 1 to
8; for segment of children 10 years old and older, Mattel have lost market presence in recent years (Babitch, 2006).
8