Nelson Peltz has renewed his quest for board seats at Disney as the media giant’s stock price continues to slide.
With a stake now estimated at $2.5 billion, Trian Fund Management, the company formed by the activist investor, is one of Disney’s largest shareholders. It is expected to ask for multiple board seats, including Peltz, people familiar with the effort told the Wrap.
Disney has already privately rebuffed Peltz’s push for director status once before, and Peltz withdrew his bid early last year after the company revealed a broad restructuring plan that briefly reversed its stock market losses. But Disney shares have tumbled to around $80 from previous highs of more around $200.
Trian previously argued that the Disney current board needed more focus, that the company was compensating executives excessively; and that it lacked expense discipline overall.
If Disney says no again to Peltz again, Trian may nominate directors to be put up for a shareholder vote at its next annual meeting. The nomination window for new board members opens on Dec. 5 and runs until Jan. 4, according to Disney’s latest proxy statement.
Trian has built it stake in recent months to more than 30 million shares, and its leadership believes the stock is significantly undervalued.
A Trian spokesperson declined to comment, while a Disney spokesperson did not immediately return a message seeking comment. The Wall Street Journal was the first to report the story.
In July, Disney CEO Bob Iger said that the company’s linear TV assets (ABC, FX, National Geographic and Freeform) “may not be core” to the company – suggesting he’d be open to a possible sale. He also said at the time that the company was on the hunt for strategic partners who could help with the eventual launch of a fully direct to consumer version of ESPN.
Additionally, Iger plans to combine Disney+ and Hulu into one app offering by the end of the year. Last month, Disney and Comcast moved up the date for the sale process of the latter’s minority stake to begin as early as Sept. 30. Under the terms of the initial 2019 put/call agreement, Disney was allowed to buy out the stake as early as January 2024 and Comcast could require that Disney do so. That agreement guaranteed a minimum total equity value of $27.5 billion for Hulu, suggesting that Comcast’s share would be worth at least $9 billion.
Disney will report its earnings for its fourth quarter of 2023 on Nov. 8.
