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Oaktree planning hostile takeover of toymaker Jakks after latest board knockback

18 Apr 2012

The world’s largest distressed debt investor is planning a hostile takeover of portfolio company Jakks Pacific after a string of knockbacks from the toymaker.

Oaktree Capital Management Funds has sent a scathing letter to the Jakks board in the wake of it rejecting a $20 per share offer from the firm last September.

The share price has since dropped to $13.39, leading Oaktree to inform the board it had missed its revenue and profit projections following the offer by a wide margin.

Oaktree plans to use a combination of debt and equity to purchase the 95 per cent of the firm it does not already own, and could replace the board if it does not prove more receptive to future bids.

The letter said, “Oaktree has no confidence in the capability and credibility of the current Board and management team.

“Immediate change is required to preserve and protect the interest of public shareholders.”

Oaktree’s move comes in the wake of its lacklustre $380m IPO last week, about one quarter less than it was hoping to raise.

The LA-based firm sold about nine million shares for $43 each, down on the 11.3 million it planned to sell according to a regulatory filing.

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