Nelson Peltz’s proxy battle was a “distraction” and Disney can now give attention to attempting to turn a streaming profit and planning its succession, its CEO Bob Iger said on CNBC’s “Squawk on the Street” on Thursday, just at some point after handing a stinging defeat to the activist investor.
“One in all the things that I feel great about straight away is, put the victory aside, that I can spend all of my time with the management team and the board on executing against those priorities,” he said.
While Disney rolled out a string of initiatives to spice up shares in recent months because the board battle went on, Iger noted that Peltz’s second proxy attempt did little to affect the corporate’s strategy for succession, business investments or its shift in content plans.
Iger told CNBC that selecting his substitute “is the board’s No. 1 priority.” He said Disney’s succession committee, which was established when he returned to his post in late 2022, held a lot of meetings in 2023, with plans for more in 2024. Iger noted that the activism has not modified Disney’s succession process. Iger’s contract runs to 2026.
Iger spoke concerning the challenges Bob Chapek faced when he took over the corporate in 2020, including shutdowns of film and TV production, the closure of theme parks and the discontinuation of live sporting events. Chapek held the post for greater than two years before Iger returned to it.
“Obviously, all of us learn from the past, and we’re prepared for this process to achieve success,” Iger said.
In an interview with CNBC on Thursday, Peltz said he didn’t have any personal vendetta against Iger but wanted to make sure the corporate had a leadership plan in place.
“The one issue I had with Bob was the succession plan, which again is on the feet of the board,” he said.
Iger also disputed the notion that Peltz’s activism was chargeable for recent company stock gains — a claim the investor has made himself.
“The market is reacting to how this company is performing,” Iger said. “It was not reacting really to the activist.”
Shares of Disney are up 32% 12 months so far. They rallied in February after the corporate made a series of major announcements during its earnings call, including that it had obtained the exclusive streaming rights to Taylor Swift’s Eras Tour concert film, made a $1.5 billion strategic investment in Epic Games and would launch a flagship ESPN streaming service.
For months, Disney had battled against Peltz’s Trian Fund Management, which sought two of the corporate’s board seats. Peltz had publicly lambasted Disney for its sustained share underperformance, failed succession process and what he claimed was billions in misdirected investments.
Peltz told CNBC he wouldn’t attempt to wage one other battle against Disney if Iger follows through on plans to enhance the corporate’s performance.
“I hope Bob can keep his guarantees,” Peltz said Thursday. ” I hope they will do all of the things they assured us they were going to do. I’ll watch and wait. In the event that they do it, they will not hear from me again.”
Shareholders sided with Disney during Wednesday’s investor meeting. Peltz lost his board seat race to Maria Elena Lagomasino by a 2-to-1 margin, and former Disney Chief Financial Officer Jay Rasulo, whom Trian also nominated, lost to Lagomasino by a 5-to-1 margin, an individual aware of the matter said. Retail voters overwhelmingly supported Disney, that person added, helping to deliver Iger 94% of the general vote.
A second activist, Blackwells, also didn’t win board seats in its own long-shot bid.
Percentage-wise, turnout for the director vote was within the mid-60s, one other person aware of the matter said. In 2023, around 63% of Disney shareholders voted.
Iger has done much to attempt to right the ship at Disney since returning to the helm of the corporate in late 2022. He undid a latest corporate structure instituted by the short-reigning Chapek and pulled back on the variety of film and tv projects the corporate was producing. Iger also announced a plan last 12 months to speculate $60 billion in Disney’s theme park, cruise and experience business over the subsequent 10 years.
Up next is a latest bundled sports service with Warner Bros. Discovery and Fox, in addition to a flagship standalone ESPN service, which is able to eventually be available directly through Disney+.
“What we’re attempting to do is largely serve sports fans in multiple ways,” Iger said, adding that he doesn’t expect significant cannibalization between the 2 products.
Iger said the flagship ESPN service may have significantly more content than the ESPN component of the three way partnership may have. He declined to reveal more concerning the three way partnership, including a possible name or price point for the service.
