Hasbro, a toy manufacturer, investors such as Boston Partners and Anchor Capital hope to replenish their board with one director nominated by investors and resolve a representative competition with Alta Fox Capital Management, an activist investment company.
Boston Partners, which owns 2.26% of Hasbro and offers $ 96 billion to customers, told Reuters on Tuesday that the board needed new directors. Furthermore, it supports the election of three activist directors. It said the settlement would benefit Hasbro and its investors.
“At this point, we are recommending to our Governance Committee to vote in favor of the Alta Fox nominees,” said a general counsel and director of sustainability and engagement at Boston Partners, William Butterly.
According to Butterly, Hasbro must upgrade capital allocation and shareholder returns, further stating that “a greater refresh of the board is necessary to drive positive change at the company level.”
He also added that his company is concerned that Hasbro last month raised the board to 13 people from the previous 11 instead of replacing current directors with two new ones.
His remarks are similar to what Anchor Capital, which owns 0.36% of Hasbro, told Hasbro’s board in a letter. Anchor, a 16-year-old Hasbro investor, said the board could enjoy the benefits of having a director or directors supported by investors on the board to set new ideas and expertise, according to two sources familiar with the situation.
However, Anchor did not say how it would cast its vote in the representative contest.
In February, Alta Fox Capital Management revealed 2.5% holdings in the maker of Play-Doh, Monopoly, and My Little Pony. In addition, it stated that it would need more board seats and that the company should consider off-shooting Coastal Gaming Wizards. For this reason, it has decided to appoint three directors to the board.
Investors will decide who is most important on the board at the Hasbro annual meeting on June 8th.
Ancora Holdings Inc revealed this month that it has a 1% stake in Hasbro and expects the company to consider the full or partial offer of Entertainment One, a network that produces shows and other content. Ancora also urged the board to appear in development with Alta Fox.
The board “is always open to hearing shareholder perspective,” said a Hasbro spokesperson, and that it put Liz Hamren and Blake Jorgensen as directors in “response to investor feedback.”
Hasbro has added five independent directors since 2016 and, since then, introduced CEO Chris Cocks, she said.