Walt Disney Co. said that activist investor Nelson Peltz didn’t present “a single strategic idea,” despite months of engagement with the company and the board.
(Bloomberg) — Walt Disney Co. said that activist investor Nelson Peltz didn’t present “a single strategic idea,” despite months of engagement with the company and the board.
Peltz’s assessment of the company’s performance seemed “oblivious” to the changes sweeping the media business, Disney said in a regulatory filing on Tuesday. The board rejected Peltz’s proposed candidacy because he lacked experience in the media business and it wanted to give newly appointed chief executive officer Bob Iger more time to deal with changes at the company.
Disney Chair Susan Arnold and General Counsel Horacio Gutierrez called Peltz on Jan. 11 and told him, “Iger’s leadership should be afforded time to execute,” according to the filing. They said the board “was concerned about disrupting management from the task ahead with the addition of Mr. Peltz as a director at this time.”
Disney, the world’s largest entertainment company, has urged shareholders to reject Peltz’s proposal to join the board. The company has yet to set a date for its annual meeting, which will be held virtually. Last year’s was held in March.
Peltz, in his own filings, has argued that Disney has underperformed in recent years. He has said its management is overcompensated and the company has made strategic errors, including the 2019 acquisition of Fox’s entertainment assets. The co-founder of Trian Partners has a roughly $900 million stake in the company. A spokesperson for Peltz declined to comment.
Disney also revealed that Peltz’s candidacy was pushed last summer by Isaac Perlmutter, the chairman of the company’s Marvel division. Perlmutter called then-CEO Bob Chapek and Chief Financial Officer Christine McCarthy and told them Peltz’s appointment was the best way to solidify Chapek’s position as CEO and prevent former executives such as Iger from coming back, according to the filing.
The company reported that former CEO Chapek earned $24.2 million in fiscal 2022, down from $32.5 million the prior year. Chapek walked away with termination payments totaling $7.6 million. Iger, who rejoined the company as CEO in November, earned $15 million, compared to $45.9 million the prior year.
Disney paid its former head of corporate communications, Geoffrey Morrell, $8.4 million after working for the company only three months and is now trying to sell his former home, which the company acquired. His successor, Kristina Schake, earned $6.2 million.
Disney rose 1.2% to pass $100 a share as of 1:50 p.m. in New York on Tuesday. They were up 15.7% this year through the close on Friday.
(Updates with trading, earlier version corrected name in last paragraph.)
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