In a blow to Walt Disney, activist Nelson Peltz announced Thursday that proxy advisory firm Institutional Shareholder Services (ISS) will recommend that shareholders elect him to the company’s board of directors in the fight against the entertainment conglomerate. received strong support.
ISS’ recommendations could sway the votes of hundreds of investors, but Mr. Peltz, Disney’s major shareholder, will not be able to help the board as it grapples with CEO succession and strategy issues in Mickey Mouse’s home turf. He said he would be able to guarantee that the company would do its job properly.
The recommendation was endorsed by Disney CEO Bob Iger on Thursday among prominent cast members including Emerson Collective founder and president Laureen Powell Jobs and Star Wars creator George Lucas earlier this week. This was carried out while continuing to collect.
The report, seen by Reuters, said: “Mr. Peltz, a dissident candidate, may have additional involvement in the succession process as a major shareholder, this time with no other assurance that the board is properly involved.” “There is potential for investors.”
Mr. Peltz’s Trian Fund Management is vying for two seats, between Mr. Peltz and former Disney finance chief Jay Laslo, while another activist firm, Blackwells Capital, is vying for three seats.
The battle over who will help run the $213 billion Disney company is one of the most intense and high-profile board battles of the year, with a prominent activist investor who says he works well with target companies and The media industry’s most talented CEOs are back in contention. He took the top job two years ago after the board fired Mr. Iger’s hand-picked successor.
Mr. Peltz and Mr. Blackwells said that after Mr. Iger’s death, Disney failed to plan, lost its creative spark and failed to properly utilize new technology.
Disney had previously rejected the qualifications of both hedge fund candidates, and on Thursday said it “strongly disagrees” with ISS’s recommendation, saying Peltz “does not bring additional skills to the board.”
Shareholders are scheduled to vote on April 3, and both sides are currently contracting prominent advocates to make their case to voters. Disney had Mr. Lucas and JPMorgan banker Jamie Dimon endorse Mr. Iger, but on Thursday, a number of company executives went public with their support for Mr. Peltz.
ISS said shareholders should refrain from voting for Laszlo, all three Blackwells candidates and current director Maria Elena Lagomasino. ISS described Laszlo as “calm and collected,” but recommended him after he was removed as a candidate to replace Iger several years ago out of concern that he would cause “friction on the board.” There wasn’t. And Mr. Lagomasino was more responsible than any other board member for not finding a suitable successor for Mr. Iger, ISS wrote.
Earlier this week, ISS’s smaller rival Glass Lewis recommended that shareholders re-elect all 12 of the company’s directors rather than adding dissident candidates.
ISS confirmed that Disney brought Mr. Iger out of retirement and brought him back to the top job in 2022, then made aggressive operational changes and added two new board members.
“Mr. Iger’s return may have been enough to plug the hole, and management has since taken several actions to chart a better course,” the report said.
But he also accused the board of not recognizing the problem quickly enough to fix it.
ISS now claims it needs more outside oversight, and Peltz, who has served on the boards of numerous publicly traded companies, said he would be unable to ensure that Disney “doesn’t run aground” after Iger’s departure. He claims to be qualified for the job. His contract is scheduled to expire at the end of 2026.
Experts noted that the fight is likely to gain even more attention on social media as the annual general meeting date approaches, with each side currently rallying high-profile supporters enthusiastically.
Several executives who worked at companies previously targeted by Peltz, including Francis Blake, Ali Dibagi and Thomas J. Asher, said they were initially “sceptical” about the companies. He expressed his support for him.
They sent a letter to Disney’s board of directors, encouraging them to work with Peltz “for the benefit of all shareholders.”
