US toy maker Hasbro is in talks to buy DreamWorks Animation - the studio which produced the blockbuster series Shrek, the New York Times is reporting.
Hasbro, known for such toys as Transformers and My Little Pony and board games like Monopoly, would pay a mix of cash and stock, the newspaper said, quoting people briefed on the matter.
No price has been set but Jeffrey Katzenberg, CEO of DreamWorks Animation, is seeking more than $US30 a share. That would value the company at just over $US2.6 billion ($A2.8 billion), the Times said.
DreamWorks Animation shares closed on Wednesday at $US22.37 in New York, giving the company a market capitalisation of about $US1.9 billion.
DreamWorks Animation is the largest independent animation studio in Hollywood.
The company was spun off in 2004 from DreamWorks Studios, founded by David Geffen, Steven Spielberg and Katzenberg.
It posts yearly revenue of about $US700 million and makes just a few films a year. But some of them, such as the Shrek series, Kung Fu Panda and Dragon, have been huge box office hits.
In September the studio held talks with another prospective buyer, Japanese telecoms company SoftBank, but they didn't yield an agreement.
