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When Hasbro announced its deal for D&D Beyond yesterday, the agreement looked like both a smart complementary move for its gaming unit and a good defensive formation against its activist investor, Axios' Michael Flaherty writes. 

Why it matters: The move comes as activist investor Alta Fox Capital Management pressures Hasbro into making strategic changes around the very division involved with this deal. 

Details: Hasbro is buying D&D Beyond from Fandom for $146.3 million in cash. D&D Beyond is a digital toolset and gaming companion for Dungeons & Dragons.

Between the lines: D&D Beyond, which has 10 million users, will be absorbed into Hasbro's Wizards of the Coast division, which oversees Dungeons & Dragons as well as other gaming franchises like Magic: The Gathering.

Wizards of the Coast is the division that Alta Fox says Hasbro should spinoff. 

Of note: D&D Beyond will give the toymaker more data on Dungeons & Dragons gamers that should help with product development, live services and tools, as well as regional expansions.

Catch up fast: Alta Fox has criticized Hasbro for going away from its core business too much and dragging down its stock price, specifically labeling its eOne purchase as "ill-advised."

Alta Fox, which owns 2.5% of Hasbro, nominated five directors to the company's 11-member board. Last month, Hasbro rejected a settlement offer that would have had only one of Alta Fox's nominees join the board. 

The bottom line: Hasbro may well have been planning this purchase before Alta Fox showed up. Still, the deal shows shareholders that Hasbro has its own strategy when it comes to moving chess pieces around its gaming division. 

1 big thing: Hasbro makes a play

A Hasbro Nerf brand football. Photo: Tiffany Hagler-Geard/Bloomberg via Getty Images

Speculation is building that Gap is about to be hit by an activist campaign that forces it to spin off its fast-growing activewear banner, Athleta, Richard writes. 

Why it's the BFD: Athleta could fetch a hefty price if Gap decides to go through with such a move. Athleta's net sales in fiscal 2021 hit $1.45 billion. 

Meanwhile, rumors around the apparel maker as either an activist, PE or split-up candidate are as perennial as skinny jeans. Talk of some kind of deal won't die no matter how many times fashion watchers declare it dead.

Driving the news: Activist Insight, an activist investor media and data firm, fanned the Athleta spin flames this week. Adrienne Yih, a retail analyst at Barclays, made similar comments.

The stock jumped more than 8% yesterday to close at $14.46.

Flashback: Gap nixed a plan to split Old Navy into a separate company in 2020.

Between the lines: There is a strong argument for spinning off Athleta, given that its chief rival, Lululemon, has a $50 billion-plus market cap.

"There's a philosophy that running a single brand and focusing on it is the smartest way to go and it allows you to be lean," noted David Silverman, a retail analyst at rating agency Fitch.

The counterpoint is that owning several brands insulates the company from cyclical risk, something rating agencies prefer when a company is carrying a lot of debt, he said.

Reality check: Ultimately, whatever Gap does is up to members of the founding Fisher family, who control 42.9% of the stock, according to FactSet. 

2. The BFD: Mind the Gap

Illustration of a clothing hanger with the hook as a question mark. 

• Indian billionaire Mukesh Ambani’s Reliance Industries is reportedly in the early stages of mulling a possible bid for Walgreens Boots Alliance’s international drugstore business, Bloomberg reports. http://axios.link/TzWL 

• GrubMarket acquired Canada-based Waudware, which specializes in building software for the North American fresh produce industry. http://axios.link/SqCZ 

3. Retail transactions

• Mindbody, the wellness technology platform, named Meisha Sherman as its chief people officer. http://axios.link/2RrR 

• eBay named Meta’s head of commerce Eddie Garcia as its chief product officer. http://axios.link/Ja18 

• SpartanNash, the food distributor and grocery store retailer, named Yu Ying Seah as its vice president, IT global applications. http://axios.link/vu44 

4. It's Personnel

📆 Today at 12:30pm ET, please join Axios' Brady Dale and Lucinda Shen for a virtual event on trends in cryptocurrency. Register. 

April 14, 2022

1 big thing: Hasbro makes a play