Isaac Larian, pugnacious founder of Bratz fashion dolls maker MGA Entertainment, knows all about toys. Despite repeated efforts, he has yet to make rival Mattel his own plaything.
After Mattel dismissed his plan to sack its directors, merge the two Los Angeles companies and put himself in charge, the Iran-born billionaire walked away this week.
Mattel, he said, "cannot be salvaged by anyone under current conditions, management and board".
The episode brings to the fore competing visions for the troubled global toy industry. Mattel, home to American Girl, Thomas the Tank Engine and Masters of the Universe, believes the future is in media, as children ditch dolls and action figures in favour of iPads and YouTube.
Mr Larian says toymakers should to stick to what they know best, and in a Financial Times interview he described as "stupid" his rival's strategy to take brands such as Barbie to the silver screen.
Mattel is certainly in need of a shake-up — at least to judge by its share price, which has shed 71 per cent of its value in the past five years. Competition from smaller upstarts and the collapse of retailer Toys R Us have added to the pressure.
Yet the company, run by Ynon Kreiz, formerly head of Endemol, the media group behind reality television hit Big Brother, says it is tackling the challenges. Net losses narrowed to US$531 million ($805m) last year and $184m ($280m) in the first quarter.
Barbie is among six films it has in the works. It is being produced with Warner Bros and features Mary Queen of Scots' star Margot Robbie as the blonde, blue-eyed doll.
For some analysts, the branch into media makes sense. "It's not clear it's a silver bullet, but it's a good strategy to try," said Linda Montag at Moody's. Mattel's listed rival Hasbro turned its Transformers action figures into Hollywood blockbusters, while Lego, the Danish toymaker, has also done well with its film franchise.
Mr Larian argued Mattel's attempt to emulate those successes would fail, however. He claimed his crosstown rival's decision to install Mr Kreiz at the helm was "like if I have a toothache and I go to a cardiologist".
"There's only Transformers and Lego. You look at everything else — [they] never became a success," he said, reeling off a list of toy-based film flops including UglyDolls and Battleship.
MGA itself had an ill-fated sojourn into the film business. Bratz, a musical comedy released in 2007, was panned by critics and fared poorly at the box office.
"The movie was a major flop and hurt the Bratz brand," Mr Larian said. "You've got to figure out what business you're in. Either you're in the movie business, or the toy business."
Mattel's financial performance is laid bare in quarterly filings but it is harder to scrutinise the effectiveness of Mr Larian's stick-to-the-basics approach. More limited information is available on privately held MGA, in which Mr Larian holds an 82 per cent stake and his family the remainder.
However, he said operating profits had risen by $500m and gross revenues by more than $1bn in the past year. "I know the toy business," he said. "We made this money the old-fashioned way, by hard work."
Mr Larian, 65, moved to California from Iran in 1971. After university he launched an electrical import company, buying Sony Walkmans, Nintendo consoles and other Japanese goods. He made his mark in toys in 1993 when he secured the rights to Power Rangers action figures.
A long-running feud with Mattel bubbled up last year, when Mr Larian pushed its board to combine with MGA. He reiterated his offer in May, and this month ramped up the pressure, saying "time is of the essence".
The deal was conditional on him becoming chairman and chief executive — Mattel's board, he said, had "gotta go" — yet the financial terms would be "for investment bankers to figure out".
Mattel was having none of it. Bob Normile, its chief legal officer, wrote to Mr Larian in early June saying the directors had "unanimously concluded that your proposal is not in the best interests of Mattel or its shareholders".
"The reality is we have made strong progress on our ongoing strategic transformation plan, including significant improvements in our profitability and operating income," Mattel added in a statement this week.
Some analysts questioned the seriousness of the bid approach. Mr Larian previously launched a GoFundMe campaign to buy Toys R US stores and he has been locked in a protracted legal fight with Mattel, claiming it stole trade secrets. A case is pending in an appeals court.
Noting the absence of detailed terms put forward by Mr Larian, Tim Conder, analyst at Wells Fargo, suggested the approach was an opportunity for the toy mogul to have a "backdoor public dig" at Mattel.
Mr Larian rejected the suggestion he was insincere. "Why would I waste time?" he asked.
Shares in Mattel, which has a $3.9bn market capitalisation, rallied as much as 9.9 per cent after he went public last week with his revived offer. This week, Mr Larian said he was no longer interested, and Mattel shares have ceded the gains.
The grandfather, who has found success for MGA with products including miniature collectibles LOL Surprise, said that Mattel needed to focus on devising new products. "That's the only way to turn it round. I would bring in product innovation, which is the bloodline of the toy business, then deal with the rest of it."
Referring to the size of Mattel's workforce, roughly 27,000 at the turn of the year including manufacturing, he said: "What are all these people doing? I think to be honest with you at least half, if not more, Mattel workers have no job to do."
Mattel is planning to cut more than $650m in costs by the end of this year.
Unless its financial performance improves, however, Mattel may find that its old nemesis will be unable to resist the temptation to toy with it further.
Written by: Alistair Gray
© Financial Times 2019