A major shareholder in Mattel is preparing to mount a proxy fight at the prominent toymaker to push the company toward a potential sale. Southeastern Asset Management has been considering nominating new directors as part of this proxy battle, according to individuals familiar with the matter who cautioned that plans could still change and no final decision has been finalized.
The activist investor has spent months urging Mattel to sell itself following double-digit sales declines across key segments, including Fisher-Price, alongside ongoing profit-margin pressures. These operational challenges became more acute following executive leadership changes at the company. Former CEO Ynon Kreiz left Mattel to join Skydance, and his replacement, former Condé Nast CEO Roger Lynch, was met with an immediate 5% drop in Mattel shares. Overall, the company’s stock has fallen 15% over the course of the year, though shares later rebounded following reports that Authentic Brands Group had drawn takeover interest.
While industry observers note it is unlikely that the activist firm could secure full control of Mattel’s board, a proxy fight would effectively serve as a referendum on the company’s strategic direction. Under Mattel’s existing corporate bylaws, an investor is generally restricted to nominating only two directors, except under specific circumstances.
Pressure on the toymaker is also mounting from other major financial stakeholders. Ariel Investments, another large Mattel shareholder, has informed fellow investors that change is urgently needed at the firm. John Rogers, founder of Ariel Investments, publicly stated during a television appearance that Mattel should pursue a sale, marking an unusual stance for an investment firm historically known for being management-friendly.
In response to the growing shareholder pressure, Mattel released a statement noting that the company regularly engages with all of its shareholders, but declined to comment further on the matter. Representatives for both Southeastern Asset Management and Ariel Investments did not respond to requests for comment regarding their ongoing positions and potential next steps.
