Activist investor Ancora asks Hasbro to sell Entertainment One unit

ACTIVIST investor Ancora Holdings wants toymaker Hasbro to explore a full or partial sale of its Entertainment One unit to cut debt and replace long-standing directors on the board, according to its letter that was seen by Reuters.

Ancora has a roughly 1 per cent stake in Hasbro, the investor said in the letter, adding that the divesture of Entertainment One can yield up to US$2 billion for the company and result in tax benefits.

The move comes after activist investor Alta Fox Capital Management’s push last week to oust Hasbro’s chairman and 2 other directors, as it seeks changes at the company, including a spin-off of its Wizards of Coast unit.

Ancora urged Hasbro’s board to reassess a tax-free spinoff of the Wizards of Coast unit, which publishes Dungeons & Dragons and Magic: The Gathering, given that its shares are trading at about 75 per cent discount to intrinsic value according to its analysis.

Monopoly maker Hasbro bought Entertainment One for about US$4 billion in cash in 2019 to expand into the lucrative infant and preschool market by gaining access to popular TV shows like Peppa Pig and PJ Masks.

Ancora’s letter was first reported by the Wall Street Journal.

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Hasbro declined to comment to Reuters when asked about Ancora’s letter. REUTERS