Jan. 4 (Bloomberg) — Hasbro Inc., the maker of Monopoly
and Scrabble, agreed to buy closely held game company Cranium
Inc. for $77.5 million, its biggest purchase in eight years.
Cranium, which makes its namesake and Hullabaloo games,
may have at least $100 million annually in revenue, estimated
Tim Conder, an analyst at Wachovia Corp. in St. Louis. The deal
may be completed in the first quarter, Hasbro said today.
Hasbro, which purchased Wizards of the Coast in 1999 for
$325 million, will increase its leading share of the worlds
board-game market, said Gerrick Johnson, an analyst at BMO
Capital Markets. Buying Cranium also allows the toymaker to
rely less on sales of products tied to movies such as “Spider-
Man 3 and “Star Wars and help it add sales overseas.
“For the small sum of $77.5 million, they have another
core brand they can expand, Johnson said today in an
interview. “The Cranium brand can really benefit from Hasbros
scale and multinational distribution. Johnson recommends
holding Hasbro stock and doesnt own any.
Phil Jackson, head of Hasbros game division, declined to
provide an estimate of the companys board-game market share.
The company wont disclose the impact the purchase may have on
earnings, he said.
Hasbro, the worlds second-biggest toymaker, fell 94
cents, or 3.8 percent, to $23.87 as of 4:22 p.m. in New York
Stock Exchange composite trading. The shares declined 6.1
percent last year, while larger Mattel Inc. dropped 16 percent.
Game Sales
Game sales made up 41 percent of Pawtucket, Rhode Island-
based Hasbros $3.15 billion in 2006 revenue and is the largest
of its divisions. Hasbro also makes Transformers, My Little
Pony dolls, Play-Doh clay and Nerf sports toys.
Cranium can “leverage our creativity and the passionate
following we have around our brand and harness with their
operational excellence and financial fortitude to take the
brand to the next level throughout the world, Cranium co-
founder Richard Tait said today in an interview.
Hasbro bought Cranium from a group of investors that
include TPG Inc. and Maveron LLC, said Tait. Hasbro will also
help Cranium expand into mass-market retailers such as Wal-Mart
Stores Inc., he said.
22 Million Games
Cranium, founded in 1998 and based in Seattle, has sold
more than 22 million games, books and toys worldwide and won
the Game of the Year award from the Toy Industry Association
five times.
The companys philosophy is to “give everybody the chance
to shine, by creating games that require different abilities.
Its namesake game requires players to spell words backward and
hum tunes to win.
“Its been a very innovative and topical brand, Jackson
said today in an interview. “Everybody finds something that
they can really excel at in their games. Thats been a unique
factor in the games business.
Proceeds of the sale will go to shareholders and pay off
Craniums debt. The final price may change depending on
Craniums assets when the purchase is completed. Other games
include Cranium Cadoo and Cariboo.
Tait, 43, said he would stay on through the transition to
Hasbro ownership, then “move on to something new, hopefully
spend some time with my family and go home to Scotland to see
his parents.
Hasbro bought the Milton Bradley games company in 1984 and
added Parker Brothers games through its purchase of Tonka Corp.
in 1991, according to its Web site.
To contact the reporter on this story:
Heather Burke in New York at
