Mattel Stock Surges on Potential Acquisition Rumors

Mattel's stock price on Wall Street surged by 18% following a report from The Wall Street Journal suggesting the toy manufacturer is a potential acquisition target for Authentic Brands Group. The brand management company is reportedly discussing an offer that could value Mattel at over $20 per share, or approximately $6 billion and upwards. Mattel's stock closed the day at around $15 per share.

A source close to the discussions confirmed to CNBC that preliminary talks are underway, noting that the approach from Authentic Brands Group is logical given the latter's interest in entertainment assets, particularly those geared towards children. Mattel stated that it does not comment on market rumors or speculation, while Authentic Brands Group declined to comment.

This news comes just a day after Mattel announced that its CEO and Chairman, Ynon Kreiz, will be stepping down after an eight-year tenure. Roger Lynch, a Mattel board member since 2018, is set to replace him. Kreiz is moving on to become CEO of Paramount-Warner Bros.

Earlier in the year, investment firm Southeastern Asset Management, a Mattel shareholder, had urged Kreiz to explore strategic options for the company, including a potential privatization or acquisition by competitor Hasbro or a major media firm. Authentic Brands Group has been actively expanding its portfolio, recently acquiring Dockers from Levi Strauss and focusing its acquisition strategy on children's entertainment and hospitality brands.