Nelson Peltz Announces Fresh Proxy Fight Against Disney
By Robbie Whelan
Activist investor Nelson Peltz intends to launch a new proxy fight against Disney after the company rebuffed his request to be added to the board.
Peltz's Trian Fund Management said Disney shareholders have lost about $70 billion in value since the activist ended its first campaign in February. Trian said that it spoke to Disney CEO Bob Iger on Thursday and that the company's board agreed to meet with the investment firm, but wouldn't grant its request for board representation.
Trian controls roughly $3 billion worth of Disney stock and is seeking multiple directors. The activist investor said it plans to take its case directly to shareholders, without specifying what changes it seeks.
Disney said in response to Peltz's announcement that it is moving from a period of fixing to one of building, has a strong balance sheet and continues to refresh its board.
Peltz announced the campaign a day after Disney said it had appointed Morgan Stanley Chief Executive James Gorman and former Sky CEO Jeremy Darroch as new directors. Peltz said the addition of Gorman and Darroch "represent an improvement from the status quo," but they would not restore investors' confidence in the entertainment giant.
Peltz launched his first campaign against Disney a year ago, seeking a board seat and deep cost cuts at the company. He backed off after Disney announced a program of layoffs and budget cuts in February, but indicated that he could come back if financial performance didn't improve.
Former Marvel Entertainment Chairman Isaac "Ike" Perlmutter said in October that he entrusted Disney shares he owns to Peltz to help press for changes at the company.
Trian said in a November regulatory filing that it has nearly 34 million shares in its war chest worth about $2.7 billion, or roughly 1.8% of the company. The majority of that stake was contributed by Perlmutter, The Wall Street Journal previously reported.
"Disney's share price has underperformed proxy peers and the broader market over every relevant period during the last decade and over the tenure of each incumbent director," Peltz said in the Thursday statement. "Investor confidence is low, key strategic questions loom, and even Disney's CEO is acknowledging that the Company's challenges are greater than previously believed."
In Disney's response to Peltz Thursday morning, the company also took aim at the relationship between Peltz and Perlmutter, a dynamic that it said "is relevant to assessing Mr. Peltz and any other nominees he may put forth as directors."
Perlmutter was terminated from his role as head of Marvel Entertainment in March, a dismissal the former executive described as a firing and Disney said was a layoff. Disney said Thursday that Perlmutter "has voiced his longstanding personal agenda against Disney's CEO, Robert A. Iger, which may be different than that of all other shareholders."