Coleco, Tomy Kogyo Agree to Swap Toys for Marketing

Coleco Industries, maker of Cabbage Patch Kids dolls, said Wednesday that it has entered a $62-million marketing agreement with Japanese toy maker Tomy Kogyo Co., which produces a variety of playthings including Pocket Pets, Robo Strux and Aurora racing sets.

Under the agreement, Coleco, which is headquartered in West Hartford, Conn., will purchase Tomy’s subsidiaries in Carson, and Toronto and market their products under the Tomy name.

The Carson facilities include Tomy’s U.S. corporate headquarters and a distribution warehouse. A Coleco spokeswoman said there has been no determination on whether there would be a shift in employment at the California facilities, which have 265 employees.

Tomy, the world’s largest privately owned toy company, also granted Coleco the right of first refusal for marketing all of the Japanese firm’s products in North America. Tomy’s 1986 sales in the United States and Canada are expected to total about $100 million.

Tomy, in turn, will become Coleco’s distributor in Japan and other parts of Asia, and the Tokyo-based firm will have first rights of refusal for marketing Coleco toys in Japan and the Far East, according to David Iida, Tomy vice chairman and president. In addition, Tomy’s overseas manufacturing facilities will become a supplier for Coleco’s product needs from Asia.

Tomy’s well-designed and innovative toys, which range from simple wind-up toys such as Pocket Pets to Omnibot electronic robots, will add a new dimension to Coleco’s more basic toy offerings of Cabbage Patch and Rambo dolls and Wrinkles puppy toys.

Coleco’s Cabbage Patch sales, which totaled $600 million in 1985, are expected to fall more than 50% this year. The company has been attempting to add new products and make new acquisitions, the most recent being Selchow & Righter, makers of Trivial Pursuit, Scrabble and Parcheesi.