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Alta Fox Recommends Shareholders Vote the GOLD Proxy to Elect a Capital Allocation and Disclosure Expert to Hasbro’s Board
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Alta Fox Capital Management, holding 2.5% of Hasbro's shares, advocates for Marcelo Fischer's election to replace Edward M. Philip on Hasbro's Board at the upcoming Annual Meeting on June 8, 2022. Fischer is presented as an expert in capital allocation and investor disclosure, emphasizing his track record of creating shareholder value, contrasting it with Philip's nearly 20 years of alleged value-destructive decisions. Alta Fox stresses the importance of providing shareholders with better financial discipline and transparency to enhance Hasbro's long-term value.
Positive
Marcelo Fischer has a strong background in capital allocation and corporate restructuring, enhancing the potential for value creation.
His tenure at IDT Corporation saw compounded shareholder value growth at 25% per year, outperforming the S&P 500.
Fischer's recent purchase of Hasbro shares aligns him with shareholder interests.
Negative
Edward M. Philip's nearly two-decade tenure is criticized for poor capital allocation and value-destructive M&A decisions.
Hasbro has consistently underperformed against the S&P 500 and its consumer benchmark in the last five years.
Lack of accountability and poor investor disclosure practices have hindered market evaluation of Hasbro.
Urges Shareholders to Compare Independent Nominee Marcelo Fischer’s Impressive Track Record to Edward M. Philip’s Value-Destructive Missteps Before Casting Vote at Hasbro’s Annual Meeting Next Week
Highlights How Mr. Fischer Can Help Improve Hasbro’s Capital Allocation, Financial Discipline and Investor Disclosure, Leading to Enhanced Long-Term Value for Shareholders
DALLAS--(BUSINESS WIRE)--
Alta Fox Capital Management, LLC (together with its affiliates, “Alta Fox” or “we”), the beneficial owner of approximately 2.5% of the outstanding shares of Hasbro, Inc. (NASDAQ: HAS) (“Hasbro” or the “Company”), today issued the below letter in connection with its campaign to elect a highly qualified and independent candidate to the Company’s defensively expanded 13-member Board of Directors (the “Board”) at the 2022 Annual Meeting of Shareholders (the “Annual Meeting”) scheduled for Wednesday, June 8, 2022.
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Fellow Shareholders,
Our singular goal in this campaign has been to help put Hasbro back on the path to creating enduring value for shareholders by adding new perspectives to the boardroom. Following months of thoughtful engagement with you, as well as the recent report released by independent proxy advisory firm Institutional Shareholder Services, Inc. (“ISS”), we decided to pursue the election of one director candidate to replace long-serving incumbent Edward M. Philip.
This election contest is about choosing the best qualified candidate to serve on Hasbro’s Board. At next week’s Annual Meeting, you have an opportunity to remove Mr. Philip and add capital allocation and financial disclosure expert Marcelo Fischer into the boardroom. We believe this is the best way to ensure that first-time Chief Executive Officer Chris Cocks can begin to lay the foundation of a turnaround that will ultimately unlock long-term value for all shareholders.
We urge shareholders to compare Mr. Fischer’s impressive track record against Mr. Philip’s value-destructive missteps during his nearly 20-year tenure at Hasbro before deciding who to cast your vote for at the Company’s Annual Meeting next week:
Marcelo Fischer
Alta Fox’s Proven, Independent Candidate
Edward M. Philip
Hasbro’s Longest-Tenured Director
Capital Allocation Expertise
As Chief Financial Officer of IDT Corporation and IDT Telecom, Mr. Fischer possesses significant capital allocation, cost discipline and corporate restructuring expertise.
As ISS noted in its report, Hasbro’s “capital allocation track record is far from stellar” during Mr. Philip’s 19-year tenure.1
M&A Track Record
Mr. Fischer has significant experience evaluating and successfully executing strategic alternative transactions.
While Mr. Fischer has executed numerous successful spin-offs, he also has demonstrated an ability to postpone or decide against a spin-off as market conditions evolve.
The current Board, which includes Mr. Philip, has a record of value-destructive M&A transactions that have not yielded meaningful value for shareholders.
In particular, ISS noted the “dilutive and expensive eOne acquisition,” which occurred during Mr. Philip’s tenure.2
Investor Disclosure Expertise
Mr. Fischer has been instrumental in promoting investor transparency across complicated business segments while at IDT Corporation.
During Mr. Philip’s tenure, Hasbro’s underperformance has been compounded by poor disclosure practices with no oversight or accountability, making it difficult for the market to properly evaluate the Company.
History of Shareholder Value Creation
During Mr. Fischer’s tenure as Chief Financial Officer, IDT Corporation (inclusive of all spin-off transactions) has compounded shareholder value at 25% a year compared to the S&P 500 at less than 10% annualized.
Hasbro has consistently underperformed both the S&P 500 and its chosen consumer benchmark over the last five years.
Alignment with Shareholders
Mr. Fischer has purchased 5,788 shares of Hasbro on the open market over the last three months.
Mr. Philip has never bought shares of Hasbro during his nearly two-decade tenure.
Rather than step down as part of the Board’s recent defensive expansion from 11 members to 13 members, Mr. Philip chose to remain in power after nearly 20 years on the Board.
Given his extremely long tenure, it is hard to imagine that the Board has not already received the benefit of Mr. Philip’s insights and experience. Contrastingly, Mr. Fischer has an undeniably strong record of long-term value creation and best-in-class disclosure practices that could help repair Hasbro. If elected, Mr. Fischer would make it a priority to work with his fellow directors to help the Board:
Establish a disciplined capital allocation framework with an emphasis on ensuring capital flows to the highest risk-adjusted return opportunities.
Improve the Company’s disclosure of relevant key performance indicators for all operating segments as well as relevant metrics for announced acquisitions to ensure shareholders can properly evaluate Hasbro.
Increase management’s accountability by aligning executive compensation with value-enhancing metrics, rigorous targets and total shareholder return.
It has become abundantly clear over the past several months that shareholders want an independent capital allocation expert in Hasbro’s boardroom, which is why we recommend you vote on the GOLD proxy card today. To contact us or to speak with Mr. Fischer directly, please visit www.StrengthenHasbro.com.
Sincerely,
Connor Haley Managing Partner
Alta Fox Capital Management, LLC
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About Alta Fox
Founded in 2018 by Connor Haley, Alta Fox is a Texas-based alternative asset management firm that employs a long-term focused investment strategy to pursue exceptional risk-adjusted returns for a diverse group of institutions and qualified individual clients. Alta Fox focuses on identifying often overlooked and under-the-radar opportunities across asset classes, market capitalization ranges and sectors. Learn more by visiting www.AltaFoxCapital.com.
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1 Permission to quote ISS was neither sought nor obtained.
2 Permission to quote ISS was neither sought nor obtained.
