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Bratz doll maker considers public stock offering

The CEO of Van Nuys' MGA Entertainment says such a move will happen 'eventually.' One analyst believes investors will be interested.

March 12, 2010|By Andrea Chang
  • MGA Entertainment lost a copyright battle with Mattel over MGA's popular Bratz dolls.
MGA Entertainment lost a copyright battle with Mattel over MGA's… (MGA Entertainment )

MGA Entertainment Inc., the maker of Bratz dolls and other toys, may sell shares in an initial public offering, Chief Executive Isaac Larian said Thursday.

But plans to go public are still far off, with Larian saying in an e-mail from Italy that it would happen "eventually."

"It will be a few years before we can rebuild our company," he said.

Van Nuys-based MGA makes toys, games, consumer electronics, home decor, stationery and sporting goods. Its toys include Little Tikes, Moxie Girlz and Rescue Pets, but the company is best known for its sexily dressed Bratz dolls, which are at the center of a bitter copyright dispute between MGA and toy giant Mattel Inc.

Gerrick Johnson, a toy analyst at BMO Capital Markets, said he thought a public offering would be well-received by the investment community and would help MGA gain access to capital as it looks to expand its product lines.

"They have a nice product portfolio that investors would be interested in, so it doesn't seem like a completely far-fetched idea," Johnson said. "The toy industry's doing well right now; the toy stocks are doing well. There's appetite for that kind of investment."

Larian said the company had considered an initial public offering a few years ago, but the plan was held up by its court battle with Mattel. Talk of MGA's interest in going public was first reported by Bloomberg News.

In December, after the Bratz dolls were found to infringe the copyrights of rival Mattel, a U.S. appeals court stayed an order to transfer ownership of the line to Mattel until it ruled on the case.

The two parties were also ordered to attempt to settle the dispute themselves, but Johnson said he doubted the two sides would reach an agreement.

"These guys are so far apart and they hate each other, that's the bottom line," he said. "It's personal at this point."

On Thursday, Mattel spokeswoman Lisa Marie Bongiovanni said the El Segundo company was awaiting the appeals court ruling and declined to comment on the progress of mediation discussions.

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