Hasbro denies rumors of going private

PAWTUCKET, R.I. (AP/WPRI) - Hasbro says it is not in talks with a private equity firm to go private.

The Pawtucket based toy maker made the statement on Thursday, after a report in the Wall Street Journal cited unnamed sources saying Hasbro was in early talks to be taken private by Providence Equity Partners.

The maker of Nerf, Transformers and Scrabble says it is not having any discussions regarding its sale. Providence declined to comment.

Hasbro says a private equity firm approached it, but Hasbro's board of directors determined it had no interest in pursuing a deal.

Trading in Hasbro's shares was briefly halted after they rose as much as 10 percent before the market opened because of the report.

Sales fell during the recession at both Hasbro and Mattel Inc., the largest U.S. toy maker, and both have seen them recover relatively quickly, indicating parents are beginning to spend more on their children as fears about jobs and the economy ease.

In April Hasbro reported its first-quarter profit nearly tripled as revenue rose 8 percent to $672.4 million.

The company is also partnering with Discovery Communications in new children's television network, "The Hub," launching Oct. 10, which will carry shows based on Hasbro properties like Transformers and My Little Pony.

That deal might make Hasbro attractive to potential investors, BMO Capital Markets Gerrick Johnson said.

"It's a good story that investors like right now," he said. "There is perhaps an expectation out there that The Hub will generate a lot more earnings and free cash flow."

But he said the stock, which is near the high end of its 52-week range, is too pricey to currently justify such a deal.

The shares rose $1.18, or 2.9 percent, to $42.30 during midday trading. The stock has traded between $22.79 and $42.88 during the past 52 weeks.