Please wait...
Please wait...

Disney activist investor Peltz wins key support ahead of pivotal proxy vote

Proxy advisory firm Institutional Shareholder Services (ISS) struck a blow to Disney CEO Bob Iger on Thursday with its endorsement of Trian Partners CEO Nelson Peltz in his quest to gain a seat on the media giant’s board.

Nelson Peltz

Over the past month, some of Disney’s most influential shareholders have been voicing public support for and opposition to activist investor Nelson Peltz, who reignited his proxy fight with the Mouse House in December.

ISS recommended shareholders vote for Peltz to gain a seat on the board at Disney’s upcoming annual general meeting, citing the company’s failure to find a successor to Iger and the “multi-year [stock] underperformance” as reasons the board needs a shakeup.

However, ISS did not endorse Trian’s other board nominee, Jay Rasulo, the former chief financial officer at Disney.

“Dissident nominee Peltz, as a significant shareholder, could be additive to the succession process, providing assurance to other investors that the board is properly engaged this time around. He could also help evaluate future capital allocation decisions,” argued ISS.

Disney responded later on Thursday, saying it believed ISS had reached the “wrong conclusion” in recommending Peltz be added to its board.

“The board strongly believes that replacing any of Disney’s nominees with any of the Trian Group or [fellow activist investor] Blackwells nominees would deprive the company of skills and expertise required to help drive value for shareholders,” it said.

Shareholders are set to vote on board seats at the annual general meeting on April 3.

With the meeting looming, both Disney and Trian have been looking to drum up shareholder support.

Bob Iger

Earlier in the week, Star Wars creator George Lucas put his support behind Disney’s board. “Creating magic is not for amateurs. When I sold Lucasfilm just over a decade ago, I was delighted to become a Disney shareholder because of my longtime admiration for its iconic brand and Bob Iger’s leadership,” he said.

“When Bob recently returned to the company during a difficult time, I was relieved. 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. I have voted all of my shares for Disney’s 12 directors and urge other shareholders to do the same.”

Last month, the grandchildren of both Walt Disney and his brother Roy O Disney also released statements in support of Disney’s board, likening Peltz to one of the “villains” in a Disney movie.

Peltz, whose New York-based company Trian holds around US$3.5bn in Disney stock, has been a thorn in Iger’s side ever since the latter returned as CEO in November 2022.

He initially threatened a proxy fight in early 2023 but dropped it in February after Iger announced a sweeping restructure and cost-cutting measures. He re-emerged with criticism of the company’s performance in December, arguing that poor financial performance has meant Disney shareholders were “once over US$200bn wealthier than they are now.”

If it were to gain seats, Trian said it would work with Disney’s board to “target and achieve Netflix-like margins of 15-20%” by fiscal year 2027, in addition to conducting a board-led review of Disney’s creative processes and structure.


Please wait...