Alta Fox Capital Management, an alternative asset management firm with a 2.5% stake in Hasbro, sent its own letter to Hasbro shareholders on Wednesday backing up its claims that the company’s Board of Directors continues to underperform and lose value.
The letter came as a response to a letter Hasbro sent to shareholders on Monday encouraging them to vote against Alta Fox’s nominees to the Board of Directors at the upcoming shareholder meeting on June 8. Hasbro’s letter picked apart Alta Fox’s nominees, including stating that Magic Hall-Of-Famer Jon Finkel has “no experience in leadership roles at corporate companies.”
Alta Fox’s letter breaks down why it thinks change needs to happen at Hasbro and explains why three current key board members, down from the original proposal of five, need removed and replaced with its nominees. The two main points Alta Fox lists as the need for the removal of its current board members are:
- “Hasbro has been run like a private company for decades due to the Hassenfeld family’s influence — and shareholders have paid the price”
- “Hasbro suffers from an arrogant, insular and ineffective board culture under Rich Stoddart and other long-tenured directors”
The letter goes into detail on what Alta Fox says are poor decisions the company has made under the current leadership, including the purchase of eOne for $4.6 billion, a 30 percent premium to eOne’s all-time high share price, which was followed by Hasbro’s shares declining 9 percent the day of the deal. It also claims there were many failures by Stoddart, Chairman, and Lisa Gersh, Chair of the company’s Compensation Committee, at their previous companies. Stoddart, Gersh, and board member Edward Philip are the three members Alta Fox wants to replace with its nominees: Marcelo Fischer, Rani Hublou, and Carolyn Johnson.
Notably, the day after Hasbro’s letter to shareholders eviscerated Alta Fox’ nominees, Alta Fox withdrew the nominations of Jon Finkel and Matthew Calkins for the election to the board. On the same day, Alta Fox filed its definitive proxy statement.
Alta Fox launched its campaign to attempt to get five nominees on the Hasbro Board of Directors and spin-off WotC back in February. Hasbro officially rejected the offer in early April and added two new board members. More information can be found at Alta Fox’s website, freethewizards.com.