Elmo is getting a new home _ or his toys are, at least.
Toy maker Hasbro Inc. said Monday it will make and market toys and games based on well-known Sesame Street characters, such as Elmo, Big Bird and Cookie Monster.
The deal takes the license away from Hasbro rival Mattel Inc., which makes Sesame Street toys under its Fisher-Price brand under a deal lasting until 2010. Hasbro will start making the products in 2011.
The agreement covers all Sesame Street toys, but Julie Duffy, a representative for Hasbro, said it's "too early to tell" which toys it will continue making, including the popular Tickle Me Elmo toy.
"We now have the rights to Elmo, so anything is possible," she said.
Financial terms of the deal between Hasbro and Sesame Workshop were not disclosed.
NPD Group industry analyst Anita Frazier said it's a "significant" win for Hasbro because Sesame Workshop is a top toy brand for children under 5 _ an age group representing nearly half of annual toy sales.
Frazier couldn't release specific sales figures for Sesame Workshop but said total toy revenue in this age range was about $10 billion in the year ending in October.
Brenda Andolina, a spokeswoman for Fisher-Price, said in a statement it was Sesame Workshop's decision to end the 15-year arrangement in which Fisher-Price made toys like Tickle Me Elmo, Hokey Pokey Elmo and Elmo Live.
Hasbro, the nation's second largest toy maker, is permitted to make the merchandise for 10 years.
"Sesame Workshop has an amazing portfolio of characters that children have enjoyed in a variety of forms for decades, and Sesame Street is a brand that parents trust," said Brian Goldner, Hasbro's president and CEO.
The products designed to entertain and educate young children will be in stores starting in 2011.
Hasbro Inc., based in Pawtucket, R.I., makes other toys, including Transformers and G.I. Joe products.
Sesame Workshop is a nonprofit educational organization that produces local Sesame Street programs seen in over 140 countries.
Shares of Hasbro rose 84 cents, or 2.8 percent, to $31.03 in morning trading. The stock earlier traded at a new year high of $31.18, topping a previous peak of $30.74.
Mattel shares added 13 cents to $20.02.