Group toys with digital to triple China business

Mattel Inc expects to grow three to four times in the more than $31 billion toys and games market in China by 2020 through digitally connected toys, as it intensifies its efforts to take on Lego Group and Hasbro Inc in the country.

Mattel - which more than halved its dividend to fund the new efforts - said its emphasis on e-commerce and repackaging its core brands as educational toys and connecting them to the internet would boost its standing in the fragmented market.

The toymaker has a market share of around 2 percent in China, lagging behind construction toy maker Lego which has 2.8 percent control over the market. Hasbro is catching up with 1 percent, according to Euromonitor International.