An activist investor has a stake in Hasbro Inc.
and backs another activist who is already fighting a proxy battle against the toymaker while pushing the company to make other changes.
Ancora Holdings Inc. owns a roughly 1% stake in Hasbro and wants it to explore a full or partial sale of Entertainment One, its unit focused on creating TV shows and other content, according to a letter that the activist sent to the company’s board of directors. seen by the Wall Street Journal. He also wants the company to replace long-serving directors on its board.
Hasbro, based in Pawtucket, RI, has a market value of around $12.5 billion and sells brands such as Play-Doh and Monopoly. Although it received a boost at the start of the pandemic as lockdowns prompted parents to spend on toys, its shares are trading below where they were five years ago.
Ancora joins Alta Fox Capital Management LLC, a little-known activist who unveiled a 2.5% stake in Hasbro in February and named five directors to the company’s board. Alta Fox urged the company to explore a spinoff from its fast-growing Wizards of the Coast gaming unit, which includes games like Dungeons & Dragons. He also criticized the company’s 2019 purchase of Entertainment One, known for the children’s show “Peppa Pig.”
Ancora said in its letter that Hasbro should replace longtime administrators with Alta Fox nominees. The activist also said Hasbro should review options for Entertainment One as it doesn’t mesh well with the rest of the business and proceeds from a sale could be reinvested elsewhere. Ancora also said Hasbro should continually consider alternatives for the Wizards of the Coast unit, which it believes the market is overlooking.
In early April, Hasbro rejected calls from Alta Fox to create Wizards of the Coast, concluding that doing so would reduce the benefits the division derives from the company’s longstanding strategy of focusing on telling stories around its brands. It also added two directors to its board, an executive from chat app company Discord Inc. and a former executive from gaming company Electronic Arts. Inc.
Chris Cocks took over as chief executive of Hasbro in February following the death last year of longtime CEO Brian Goldner.
Hasbro said in a statement that Alta Fox’s campaign began shortly after Mr. Goldner’s death and “is a distraction at a time when our new CEO should be given the opportunity to focus solely on our business.”
Hasbro shareholders must vote on the competing slates of directors on June 8, unless the two parties agree before then.
Activist pressure comes as Hasbro rival Mattel Inc.
has been in talks with private equity firms about a potential sale, The Wall Street Journal reported last week. The two have been fierce competitors over the years and in 2017 Hasbro made an unsuccessful takeover bid for Mattel.
Ancora, based in Cleveland, Ohio, has recently run campaigns at companies including packaging maker Berry Global Group Inc.
He was also part of a trio of activists who clashed with retailers Bed Bath & Beyond Inc.
and Kohl’s Corp.
Write to Laura Cooper at firstname.lastname@example.org
Copyright ©2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8
Appeared in the print edition of May 3, 2022.