Mattel Agrees To Acquire Pleasant Company

LOS ANGELES, June 15 -- Mattel, Inc. and Pleasant Company today announced an agreement by which Mattel will acquire the Wisconsin-based direct marketer of books, dolls, clothing, accessories and activity products bearing the American Girl brand for $700 million. Mattel also announced that Pleasant Rowland, president and founder of Pleasant Company, will become vice chairman of Mattel, Inc. and will serve on Mattel's board of directors.

"This is a perfect strategic fit," Jill Barad, Mattel's chairman and chief executive officer, said. "In addition to acquiring a blue chip brand, we will benefit from Pleasant Company's state-of-the-art direct marketing operation, and their expertise in integrating books and products -- a competency that can be shared with other Mattel brands," she said. "And through Mattel's global network we can adapt the American Girl concept to be relevant to girls all around the world.

"Pleasant Rowland is a true visionary, who has built an outstanding company whose products are designed to educate and entertain girls -- an audience Pleasant and I care deeply about," Barad said. "The American Girl brand is one of this country's most respected brands, with its high-quality, age-appropriate products that help to promote girls' self-esteem. I will be honored to have Pleasant as my partner as we grow Mattel for the future."

"In Mattel, we have found a premier company that shares our vision for the future," Pleasant T. Rowland said. "By combining our American Girl products and the values they represent with Mattel's strength as the leading company in its industry, we will provide new growth opportunity for our brand and future product lines. We're enormously excited about this partnership."

A former teacher and author of children's educational programs, Rowland founded Pleasant Company in 1985. In 12 years, the company has grown to be one of the top 20 consumer direct-mail companies, one of the top 16 juvenile publishing houses and publisher of one of the top 10 children's magazines.

The American Girls Collection, Pleasant Company's flagship product line, integrates books, dolls and accessories designed to give girls ages seven and up an understanding of American history and foster pride in the traditions of growing up an American girl. The American Girl brand also includes: American Girl magazine, a bimonthly publication whose contemporary format has become a favorite of more than 700,000 subscribers; the American Girl of Today, a line of dolls, accessories and writing journals that reflect the individuality of girls today; A.G. Gear, contemporary clothing and lifestyle accessories; a list of best-selling American Girl advice and activity books; and Bitty Baby, a line of baby dolls and board books designed for girls ages three and older.

Pleasant Company, with annual revenues of approximately $300 million, will maintain its headquarters in Middleton, Wisconsin, operating as an autonomous unit of Mattel. It is expected that the transaction will be completed during the 1998 third quarter, and that it will be modestly accretive to Mattel's 1998 earnings.

Mattel, Inc. is the worldwide leader in the design, manufacture and marketing of children's toys. With headquarters in El Segundo, California, Mattel has offices and facilities in 36 countries and sells its products in more than 150 nations throughout the world.

Note:

Forward-looking statements included in this release with respect to the financial condition, results of operations and business of the company, which include, but are not limited to, the Mattel and Tyco restructuring charge, cost savings and profitability, are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in such statements. These include without limitation: the company's dependence on the timely development, introduction and customer acceptance of new products; significant changes in buying patterns of major customers; possible weaknesses of international markets; the impact of competition on revenues and margins; the effect of currency fluctuations on reportable income; unanticipated negative results of litigation or environmental matters; and other risks and uncertainties as may be detailed from time to time in the company's public announcements and SEC filings.