Hasbro said to be in talks to buy DreamWorks Animation

In a deal that would be an unusual union of toy maker and an animation studio, Hasbro is in talks to buy DreamWorks Animation, a person briefed on the matter said on Wednesday.

Under the current terms of the proposed deal, Hasbro would pay a mix of cash and stock, though an exact price has not been determined yet, this person said. Jeffrey Katzenberg, the chief executive of DreamWorks Animation, is seeking more than $30 a share, a significant premium over his company's current stock price.

Read MoreHasbro profit up 43% on higher sales of Transformers, Marvel toys

Shares in DreamWorks Animation closed on Wednesday at $22.37, giving the studio a market value of $1.9 billion. Hasbro's stock closed on Wednesday at $57.47 a share, giving it a market value of about $7.1 billion.

Negotiations between the two sides are continuing and may still fall apart, this person cautioned.

A deal for DreamWorks Animation would come more than a month after the studio held discussions with another unusual potential acquirer, the Japanese telecommunications company SoftBank. It is unclear why those talks fell apart.

Read MoreJapan's SoftBank in talks to buy DreamWorks: Source

But in courting DreamWorks Animation, Hasbro believes that it can find a new outlet for its stable of properties, notably the resurgent My Little Pony line of toys.

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Led by Mr. Katzenberg — a prominent entertainment mogul who is expected to stay on if a deal is completed — DreamWorks Animation is Hollywood's smallest film studio, producing only a handful of movies a year. But it has been responsible for blockbusters like the "Shrek" and "Kung-Fu Panda" franchises. The company was spun off in 2004 from DreamWorks Studios, which is privately owned.

The studio has fallen on harder times of late, with recent films like "Turbo" and "Rise of the Guardians" falling well short of expectations. Even its most recent hit, "How to Train Your Dragon 2," suffered from lower domestic ticket sales than its predecessor.

That run of misfortune helped contribute to two consecutive quarterly losses, including a $15.4 million loss in the quarter ended June 30.

News of the transaction was reported earlier by Deadline.com, a trade publication.