Disney Lines Up Shareholder, Business Leader, Family Support for CEO Bob Iger, Board

As The Walt Disney Co. approaches its contentious annual shareholder meeting on April 3, the media giant is aligning a cast of influential voices from across business and media, as well family descendants of Walt and Roy O. Disney, in support of Disney’s current board of directors and CEO Bob Iger.

The shareholder meeting is shaping up as a showdown with activist investor Nelson Peltz, whose New York-based Trian Fund Management owns $3.6 billion in Disney common stock and wants to be appointed to the board along with former CFO Jay Rasulo. Peltz says he supports Iger remaining CEO through the executive’s previously announced departure in 2026.

Key figures backing the current board include Jamie Dimon, CEO, JPMorgan Chase, filmmaker George Lucas, former Disney CEO Michael Eisner, Laurene Powell Jobs, founder/president, Emerson Collective, and Mason Morfit, ValueAct Capital co-CEO and chief investment officer, among others.

“Putting people on a board unnecessarily can harm a company. I don’t know why shareholders would take that risk, especially given the significant progress the company has made since Bob Iger came back,” Dimon said in a statement.

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Lucas, who sold his Lucasfilm to Disney for $4 billion in 2012, said Iger’s board members and leadership are critical in the current economic market.

“No one knows Disney better. I remain a significant shareholder because I have full faith and confidence in the power of Disney and Bob’s track record of driving long-term value,” Lucas said.

All the grandchildren of Roy O. Disney, which includes the outspoken Abigail E. Disney, a longtime critic of corporate business practices, tax laws and wealth, stand behind the current Disney board and Iger.

“We may not agree about everything, but we know that our grandfather would be especially proud of what Disney means to the world today,” they said in a statement. “We also know that, like us, he would be very concerned by the threat posed by self-anointed ‘activist investors’ [and] hedge-fund-backed opportunists who are really wolves in sheep’s clothing, just waiting to tear Disney apart if they can trick shareholders into opening the door for them.”

Activist Investor Nelson Peltz Reaffirms Call for Disney Board Change While Still Supporting CEO Bob Iger

Activist investor Nelson Peltz, whose Trian Group owns more than $3.5 billion worth of Walt Disney Co. common stock, March 25 reaffirmed his call for change in the composition of Disney’ board of directors, advocating for the nomination of himself and former Disney CFO Jay Rasulo at the upcoming shareholders meeting on April 3.

Peltz and Trian contend the Disney is the most consumer-advantaged entertainment company in the world, but that over the past 10 years the media giant has “woefully underperformed,” costing shareholders more than $200 billion in value.

Peltz believes he and Rasulo should replace current board members Maria Elena Lagomasino and Michael B.G. Froman — while maintaining support for CEO Bob Iger.

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Peltz and his backers believe Disney’s problems revolve around the board, which they claim lacks focus, alignment and accountability. In addition, Peltz contends the board members have invested “almost none of their own money” in Disney stock, and have failed to heed investor input.

Specifically, the activist says the Disney board failed shareholders by installing Bob Chapek as CEO in 2020 following the abrupt departure of Iger without appropriate vetting or oversight.

“The board then renewed Chapek’s contract just months before firing him for poor performance. Ultimately, the board had to call Iger out of retirement to fill the void,” Peltz and Trian wrote in a press release.

Peltz contends the board election is not about Iger, whom he emphasized is admired and respected by service providers and advisors.

“This campaign is not about Iger, nor is it a referendum on his leadership,” Peltz wrote. “That Disney spends so much time and ink defending Iger — while saying almost nothing about the two director candidates whose reelection Trian is challenging — is both troubling and telling.”

The investor said he and Rasulo (who held the CFO position for five years) would work collaboratively with board members.

Notably, in 2019, at the bequest of Iger, Peltz was asked to address the Disney board in a discussion all parties said was “seemingly productive and interactive.”

Peltz and Trian believe that re-electing the current Disney board would lead to more of the same: questionable strategic and capital allocation decisions, poor executive compensation alignment and suboptimal succession planning.

“Voting for change versus more of the same, is really what this election is about,” Peltz wrote.

Disney Cites ‘Wrong Conclusion’ by Wall Street Advisory Firm ISS Backing Activist Investor Nelson Peltz’s Bid to Join Board

The Walt Disney Co. March 21 wasted little time denouncing a same-day report from Wall Street proxy advisory firm Institutional Shareholder Services that backs activist investor Nelson Peltz joining the media giant’s board of directors. The proxy firm rejected adding Peltz’s co-board nominee, former Disney CFO Jay Rasulo, among others.

Peltz contends that Disney’s stock, under the direction of CEO Bob Iger, has underperformed, losing billions on a streaming-centric strategy, among other missteps.

Disney shareholders are meeting April 3 to vote on a new board of directors, among other company matters.

“While we’re heartened to see support for [current] board member Michael Froman and ISS’s recommendation to withhold on dissident directors Jay Rasulo and the Blackwells’ nominees, we strongly believe that ISS reached the wrong conclusion in its recent report when it comes to adding Nelson Peltz to the board,” Mark Parker, chairman of Disney’s board, said in a statement.

“In contrast to Glass Lewis, ISS fails to acknowledge … the strong recent performance and results overseen by the Disney board that demonstrate our focus on long-term shareholder value creation and succession planning an our commitment to good governance practices,” Parker said.

Earlier this month, separate proxy advisor Glass Lewis recommended Disney shareholders support of all of the media giant’s 12 board member nominees, including CEO Bob Iger, (excluding Peltz, and others) at the upcoming annual shareholder meeting.

“Star Wars” creator George Lucas earlier this week threw his support to Iger, who in 2012 orchestrated Disney’s $4 billion acquisition of Lucasfilm.

“Creating magic is not for amateurs,” Lucas said in a statement. “I remain a significant shareholder because I have full faith and confidence in the power of Disney and Bob’s track record of driving long-term value. I have voted all of my shares for Disney’s 12 directors and urge other shareholders to do the same.”

Investor Trian Files Proxy Statement to Place Its Exec, Former Disney CFO on House of Mouse Board

Activist Disney investor Trian Fund Management Jan. 18 made good on its pledge to wrest away some control of the the Walt Disney Co.’s board of directors with the nomination of Trian’s Nelson Peltz and former Disney CFO Jay Rasulo to the board.

Nelson Peltz

Trian, which nominated the executives in a regulatory proxy statement targeting Disney shareholders, contends Disney — including its movie studio, direct-to-consumer (i.e., streaming) business and amusement business — is currently mismanaged and in need of third-party management input.

Specifically, Peltz complains Disney’s streaming business significantly lags behind what he calls “Netflix-like” operating margins of from 15% to 20%.

“The company is not being run properly,” Peltz Jan. 18 told CNBC’s “Squawk on the Street.

Trian, which owns about $3 billion in Disney stock, and Peltz have long engaged directly with Disney CEO Bob Iger and the company board. Shortly after Iger returned to the CEO position, replacing his short-lived successor Bob Chapek, Peltz aggressively sought board seats unless Disney made significant changes.

Iger shortly thereafter announced planned layoffs of 7,000 global Disney employees, among other cuts, in an effort to reduce $5 billion in operating costs.

“They promised they were going to improve things,” Peltz told CNBC. “I took them at their word. Things got worse. The stock went down. Results got worse. So, no more. I can’t continue to give them more opportunities.”

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Trian, according to its Disney-related website, RestoreTheMagic.com, contends Iger and the board are significantly less invested financially than Trian. In addition, the investment firm claims Disney’s return to shareholders is down 40% over the past 10 years, compared a 208% increase in the S&P 500 and 441% spike among “Disney’s self-selected media peers.”

According to the website, Trian believes the root cause of Disney’s underperformance is a board that is too closely connected to a long-tenured CEO (Iger) and too disconnected from shareholders’ interests.

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Specifically, Trian says Iger has sold more than $1 billion in company stock since 2005, and currently only owns around $19 million of Disney stock. At the same time, Disney’s non-management directors allegedly own around $14 million in collective Disney stock.

“Are Disney shareholders really to believe the current board is able to heal these self-inflicted wounds?” Peltz said in the proxy statement. “We respectfully believe the answer to that question is ‘no,’ and we will seek the support of shareholders for meaningful change in the board’s [members].”

Disney, which has formally rejected Trian’s board nominees, on Jan. 16 nominated a slate of 12 board members, which include Mark Parker, executive chairman of Nike; Mary Barrra, CEO of General Motors; and Iger, who has announced he is retiring in 2026.

Wall Street Activist Ends Proxy Fight After Disney Cost-Cutting Announcement

The day after Disney CEO Bob Iger announced $5.5 billion in spending cuts, which include 7,000 job layoffs, billionaire Wall Street activist investor Nelson Peltz with Trian Partners announced that his high-profile proxy fight to secure a board seat is over.

Nelson Peltz (Trian Partners photo)

“We wish the very best to Bob, this management team and the board. We will be watching. We will be rooting,” Peltz told CNBC. “The proxy fight is over.”

Peltz, whose company owns $900 million worth of Disney shares, had sought a board seat either for himself or his son in an effort to change what he characterized as “weak corporate governance” at the Magic Kingdom, which he claimed had resulted in lower stock valuation.

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Indeed, Disney’s high-profile subscription streaming service reported its first-ever quarterly subscriber loss (through Dec. 31, 2022), in addition upping operating losses to $1.1 billion. Disney claims its direct-to-consumer business unit, which also includes Hulu, Hulu + Live TV and ESPN+, will be profitable by fiscal 2024.