Activist investor Nelson Peltz will try to fight his way onto the Walt Disney board after the company refused to appoint him as a director, setting the stage for one of the biggest US proxy battles in decades. years.
Peltz plans to pitch his bid for a board seat directly to investors, according to people briefed on his plans, pitting him against Bob Iger just months after he returns for a second term as the group’s chief executive. sprawling entertainment.
Disney said Wednesday it was opposed to giving a board seat to Peltz, the head of New York-based Trian Partners, which has a $900 million stake in the company. In an apparent attempt to get ahead of the impending fight, Disney has named Nike veteran Mark Parker as its next president.
Parker will succeed Susan Arnold, whose leadership was called into question last year due to the company’s handling of former chief executive Bob Chapek’s final months.
Peltz’s proxy fight against Disney would be one of the biggest boardroom battles since he established himself as director of consumer products group Procter & Gamble in 2018.
The months-long proxy battle, in which both sides spent more than $100 million to woo shareholders, enthralled Wall Street, and Peltz ultimately emerged victorious by a 0.002% margin before going retire in 2021.
Trian released a 35-page report shortly after Disney’s announcement criticizing its M&A strategy, particularly the 2018 acquisition of 21st Century Fox, saying it was showing ‘poor judgment’ .
The activist fund also denounced cost inefficiency in Disney’s streaming business, which it said has resulted in $11 billion in losses for the company to date, and called its planning process a the succession of “broken”.
In the report, titled “Restoring the Magic,” Trian laid out his vision for Disney, including calls to secure a successor to Iger within two years and a reinstatement of his dividend by 2025.
A person close to Disney criticized the Peltz plan for its lack of strategy. “It’s really surprising that there are criticisms in [Trian’s presentation] but literally not a solution,” the person said. “Peltz has no plan.”
Disney said Arnold, the first woman to chair the entertainment group, will not stand for re-election as a director at the company’s upcoming annual meeting due to an imposed 15-year term limit. by the terms of office of the board of directors.
Her stint as chairwoman, which began in 2021 after Iger left office, was marked by challenges posed by the Covid-19 pandemic, which has hurt theater and theme park businesses in Disney.
She came under intense scrutiny after the company renewed Chapek’s contract last summer following a deadly confrontation with the governor of Florida over an education bill. deemed anti-LGBT by his opponents, to dismiss him in November.
Parker, executive chairman of Nike, served on Disney’s board of directors for seven years. In a statement, Arnold said Parker “helped [Disney] navigate effectively through a period of unprecedented change”.
Iger signed a two-year contract with Disney upon his return in November. In a statement, Parker said his top priority would be “to identify and prepare a successful CEO successor” and that the process “has already begun.”
Disney’s share price has fallen nearly 40% over the past year as investors have begun to question the entertainment group’s high spending on its streaming business.
The stock’s poor performance caught the attention of activist investor Daniel Loeb, who successfully convinced Disney to appoint media veteran Carolyn Everson to its board of directors last fall.
In a statement Wednesday, Disney said its senior management and board have engaged with Peltz “on multiple occasions.” He said he remained “open to constructive engagement” with him but would not endorse his appointment to the board.
Parker spent 13 years at the helm of Nike, the world’s largest sportswear maker by revenue, during a period marked by revenue growth but also controversy, including an alleged “boys club” culture and a doping scandal.
A lifer who joined as a shoe designer in 1979, Parker became chief executive in 2006 and oversaw an expansion of Nike’s online and direct-to-consumer sales. Total revenue more than doubled to $39.1 billion in 2019, the last full year of his tenure.