With its share price flirting and under growing pressure from activist investor Nelson Peltz of Trian Partners, newly reinstalled Disney (SAYCEO Bob Iger reportedly spent the holidays enjoying the open waters.
According to a proxy statement Filed by Trian Partners on Thursday, Iger, while speaking on a Dec. 20 call, postponed a virtual meeting between him, the Disney board and Peltz until January because he planned to “sail his yacht off the coast of New Zealand”. ” “
The virtual meeting was finally set for January 1. 10, with a Disney rep advising Trian on Dec. 1. 25 the meeting would be limited to only 30 minutes.
According to the statement, an additional 15 minutes were taken at the request of the activist hedge fund after its representatives expressed disappointment with the time limits.
After the virtual meeting officially took place earlier this week, a person familiar with the situation told Yahoo Finance that Peltz found a very disengaged Disney board. Not a single question was asked of Peltz, the source added.
“Nelson is gearing up for a fight here,” the source said, noting that Peltz may be pressing Disney to cut spending among other moves designed to boost profits and plummet the stock price.
Peltz — who has led successful advocacy campaigns at well-known brands like P&G — would also like to see Disney’s dividend cut during the pandemic reinstated, the source said. Peltz hasn’t decided whether an ESPN Disney spin-off – like Wall Street has been pushed into the past – should happen, the source added.
Peltz Told owns about $900 million in Disney stock and also criticized Iger’s compensation in a lengthy new slideshow titled “restore the magic.”
Iger was not made available to Yahoo Finance for an interview.
Certainly, this is shaping up to be one of the most brutal militant battles of recent times – filled with big egos, big money and a big brand.
On Wednesday, Disney announced executive chairman and former CEO of Nike, Mark Parker will take over position of Susan Arnold as Chair of the Board. The company also recommended that shareholders vote against Peltz in his effort to win a seat on the company’s board.
Although senior management of The Walt Disney Company and its Board of Directors have spoken with Mr. Peltz on several occasions over the past few months, the Board does not endorse the Trian Group nominee and recommends that shareholders not support their nominee and vote FOR all of the company’s nominees (listed above),” Disney wrote in a press release.
A source told Yahoo Finance that Peltz was not offered an observer role on the board. as previously reported by other media. Instead, the source says Peltz was offered information sharing under a nondisclosure agreement and the opportunity to meet with management and the board quarterly.
According to Thursday’s statement, Peltz had expressed interest in joining Disney’s board as early as July and had multiple conversations with former Disney CEO Bob Chapek before resuming talks with Iger on Nov. 1. 23 – three days after being reappointed to the managerial position.
During that November meeting, Trian representatives reportedly confirmed that they did not want to engage in a long and costly proxy battle, and expressed their support for Iger’s return.
At that time, Disney mooted the idea of a mutually agreed-upon independent director being added to the board, but Trian doubled that representation with a Trian partner in an effort to “nurture an ownership mentality in the meeting room” and to “stimulate additional discussions”. among Disney directors “regarding the challenges facing the company,” the statement said.
Disney faced a tough 2022 as shares fell around 45%, marking the House of Mouse’s worst annual stock market performance since 1974.
The profitability of streaming, the future of Hulu and a possible spin-off from ESPN everything is at stake As Iger continues to navigate a battered business beset with leadership challenges, unfavorable price increases and a direct-to-consumer division struggling to turn a profit.
Still, the media giant defended the company’s stock performance under Iger’s watch, noting during his first round as CEO that the company’s total shareholder return totaled 554%, surpassing the return total of 244% achieved by the S&P 500 during this period.
Brian Sozzi is editor-in-chief and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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