The time could be right for a combination of toy makers Hasbro and Mattel.
Hasbro makes things like Monopoly, My Little Pony, and Nerf while Mattel makes stuff like Barbie and Hot Wheels.
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Bloomberg reported last year that the two had held merger talks, but the conversations didn't go anywhere.
But there's a couple of reasons to believe that a combination now would make sense, according to UBS.
First, there could be a broader consolidation in the toy market anyway. UBS said:
Second, Mattel is currently trading at 15x 2018 estimated earnings per share, while Hasbro is trading at 19-20x.
Third, the UBS models project that if Hasbro pays a 30% premium for Mattel stock, a take out price of $33 a share, Mattel would save $80 million in synergies the first year, $240 million the second, and $400 million by the third. The result would be a 33% increase in Hasbro's EPS by 2019.