July 18, 2024

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Disney clashes with Nelson Peltz as activist launches new proxy battle

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Nelson Peltz has launched a second proxy battle at Walt Disney after the entertainment group rejected his push to join the board, setting off another bitter fight between the activist investor and chief executive Bob Iger. 

Peltz’s Trian Partners fund, which controls a roughly $3bn stake in Disney, said in a statement on Thursday that it intended to take its “case for change directly to shareholders”, after Iger again turned down Trian’s request for board representation. 

“Since we gave Disney the opportunity to prove it could ‘right the ship’ last February, up to our re-engagement weeks ago, shareholders lost [about] $70bn of value,” Trian wrote. 

Peltz’s firm called off an earlier proxy fight with Disney in February after Iger unveiled a plan to revive the company by cutting costs and taking other measures to make its streaming business profitable.

However, people familiar with Peltz’s thinking said his main issues were with Disney’s share price and its margins as well as the board’s decision in July to extend Iger tenure’s as chief by two years to the end of 2026. 

Disney shares are up about 4 per cent this year, underperforming the near 19 per cent rally in the broader stock market.

“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,” Trian wrote in its statement. 

In response, Disney said on Thursday it “has a proven track record of delivering long-term value to our shareholders and is in the midst of a significant transformation”.

The company added that Peltz was working in partnership with Isaac Perlmutter, a former Disney executive who owns 78 per cent of the shares that Trian “claims to have beneficial ownership of”. According to Disney, Perlmutter, who was fired earlier this…

2023-11-30 19:39:56

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