JAKKS WINS DISNEY CONTRACT.

Byline: Greg Hernandez Staff Writer

The Walt Disney Co. has entered into a three-year agreement with Malibu- based Jakks Pacific Inc. to develop and market new products based on Disney characters ranging from classics like Winnie the Pooh to more recent ones from ``The Lion King'' and other films.

The alliance, announced Monday at the American International Toy Fair in New York, has been in the works for about two months. Financial details were not disclosed.

``Getting Disney is only positive,'' said William Gibson, an analyst with Banc of America Securities in San Francisco. ``It only helps you gain shelf space in the retailers.''

Brett Hendrickson, an analyst with B. Riley & Company in Los Angeles, said it's difficult to gauge how good the deal is for Jakks because the details are confidential. ``Until you look at how the royalties are structured, you never really know for sure.''

But Hendrickson said winning the account is a major coup for Jakks, which announced over the weekend its acquisition of Toymax, making Jakks the third-largest toymaker in America.

``Jakks might be the quickest and nimblest toy company out there in terms of getting products to market and showing licensees what they can do with a title,'' he said. ``We believe that might have been what allowed them to win over Disney for this piece of business.''

A series of Disney products priced at $10 or less and marketed under Jakks' Flying Colors Division will begin appearing in retail outlets in May.

``Having access to an array of classic Disney characters, as well as new filmed entertainment properties, gives us the opportunity to firmly establish Flying Colors as the undisputed leader in its field,'' said Stephen Berman, president and chief operating officer of Jakks.

The deal marks the first time Disney has signed a comprehensive licensing agreement that encompasses all of its properties. Usually, the entertainment giant strikes up separate deals for its classic characters and current movies.

Tim Kilpin, a senior vice president in Disney's consumer products division, said Jakks was chosen because of its extraordinary history of maximizing toy and activity-related properties.

``Their ability to rapidly develop new products, combined with their unsurpassed channels of distribution, is the perfect fit for the upcoming launch and marketing of Disney Magic Artist brand activity toys,'' Kilpin said.

The products will initially be art-activity and junior-sport toys. For example, several art buckets filled with crafts and activities will be among the first products to debut in the new Disney-based series. Also planned are storybook activities that will retail for $5.99.

``We are paying a lot of attention to make sure the activity is appropriate to the property and not just label-slapping,'' said Cheryl DeSisto, vice president of marketing sales and product development for Jakks.

Jakks will also be developing ESPN board games, sports-oriented activities spun off from the Disney-owned cable property. No details on the ESPN games were disclosed.