Hasbro Board of Directors Re-Elected, Defeats Attempt to Spin Out Wizards of the Coast

Hasbro announced that its shareholders had re-elected its full board of directors, defeating an attempt by an activist investor to install a new board member and bring other changes to the toy company. Hasbro announced that a preliminary tally of votes showed that the board was re-elected “with a substantial margin,” subject to a final certification from an independent inspector. 

The vote brings to an end a months-long battle over the fate of Hasbro and its profitable Wizards of the Coast division. Alta Fox, an investment fund that owns 2.5% of Hasbro’s shares, had pushed for an alternative slate of five board members and an end to Hasbro’s “brand blueprint” business model, which drives toy sales by creating entertainment projects of its various franchises. Alta Fox also wanted to spin out Wizards of the Coast, the division that produces Magic: The Gathering and Dungeons & Dragons, into its own company in an attempt to create what they saw was more value by making a second publicly traded company with a more profitable line of business. 

While Alta Fox made headlines with their controversial plan and proposed shakeup of Hasbro, recent reports indicated that they were unlikely to succeed. In recent weeks, Alta Fox pared down its board candidates from five to three to ultimately one. While other major investors proposed either a reconciliation between Alta Fox and Hasbro or a withholding of votes from one board member to express dissatisfaction with Hasbro’s performance, Hasbro sent out a letter to shareholders urging them to stay the course and vote for its current board. 

Because of a combination of internal drama over the fate of the company and poorer-than-expected revenue, Hasbro’s shares had dropped in value by nearly 12% since the beginning of the year. However, Hasbro’s stock price was up slightly today as reports indicated that the board shake-up was unlikely to happen.