Updated from 8:28 a.m. EDT

Toy maker


(MAT) - Get Mattel, Inc. Report

said Friday that it had agreed to sell its

Learning Co.

unit to private buyout firm

TheStreet Recommends

Gores Technology Group

for a right to a share of the company's future earnings.

The deal, which netted Mattel no cash, ranks as one of the worst corporate deals ever. Just 16 months ago Mattel bought the education software company for $3.5 billion. It has been trying to

sell the division for months.

Also Friday, the El Segundo, Calif.-based company announced a major restructuring aimed at getting the company's finances in order. It said it would cut 350 jobs, or 10% of its workforce, at its headquarters. In addition, the company lowered its dividend from a quarterly 9 cents to a yearly 5 cents, an 86% reduction which will result in $130 million in annual savings.

The deal to shed the Learning Co. will result in an after-tax loss of $430 million.

Mattel finished Friday regular trading down 13 cents, or 1%, at $11.50.