In a surprising move, private equity firm L Catterton, which is supported by luxury goods giant LVMH, has reportedly approached toy maker Mattel with an acquisition offer. Sources familiar with the matter have revealed this development, stating that the move could potentially spark interest from other potential suitors, including rival Hasbro.

Although Hasbro was said to have been aware of L Catterton's approach and is considering submitting an offer, sources caution that there is no certainty that Mattel will explore a sale. The sources, who preferred to remain anonymous due to the confidential nature of the matter, also pointed out that unsuccessful merger talks have been held between Hasbro and Mattel in the past.

A spokesperson from Mattel declined to comment on the speculation, but expressed confidence in the company's standalone strategy and ability to create long-term shareholder value. Hasbro similarly refrained from commenting, while L Catterton did not respond to requests for comment.

The news of L Catterton's interest in acquiring Mattel resulted in a significant jump in Mattel's shares, which rose by 20% to $19.49. This surge increased the toy maker's market value to $6.5 billion. Hasbro, too, experienced a boost in its shares, rising by 4% to $61.25.

Mattel has been making efforts to offset the lukewarm demand for its toys by seeking media partnerships. Despite the success of the Barbie movie released last year, the company's shares had experienced a decline of 23% in the past year. Concerns regarding profitability and the handling of unprofitable toy franchises have bothered investors.

The El Segundo, California-based company, however, reported a smaller-than-expected loss for the first quarter, thanks to cost-cutting measures and cost control amidst weak sales. In February, activist investor Barington Capital urged Mattel to consider changes, such as exploring options for its Fisher-Price and American Girl brands, as well as separating the roles of CEO and chairman.

With $34 billion in assets under management, L Catterton has an extensive investment portfolio in consumer brands. In 2016, the firm partnered with LVMH and LVMH CEO Bernard Arnault's family office, selling a stake to them. Hasbro, on the other hand, has also taken steps to reduce expenses, resulting in a smaller-than-expected drop in first-quarter sales and surpassing profit estimates.

While speculation of a potential merger between Mattel and Hasbro has sparked interest among analysts, concerns about potential antitrust obstacles linger. Both companies, however, reached a partnership agreement last year to co-brand popular toys and games from their respective brands.

As the story unfolds, it remains to be seen whether Mattel will seriously consider L Catterton's offer and if any other suitors will enter the picture.