Nelson Peltz, founder and chief executive officer of Trian Fund Management, through the Future Investment Initiative (FII) Institute Priority Summit in Miami, Florida, US, on Thursday, March 30, 2023.
Marco Bello | Bloomberg | Getty Images
Activist investor Nelson Peltz and his firm are searching for greater than two seats on Disney’s board, in keeping with an individual conversant in the matter, setting the stage for a proxy fight.
Trian Fund Management, which Peltz co-founded, said Thursday morning that it “intends to take our case for change on to shareholders.”
Disney, for its part, suggested the proxy fight stemmed from a private grudge held by one in all Peltz’s allies, former Marvel boss Ike Perlmutter.
Trian said Disney earlier within the day offered to establish a gathering with the entertainment giant’s board, but rejected Trian’s bid to hitch the board, including the addition of Peltz. Trian didn’t note in an announcement what number of seats it plans to hunt.
Trian declined to comment beyond its statement.
The news got here the morning after Disney added Morgan Stanley CEO James Gorman and former Sky TV boss Jeremy Darroch to its board, a move widely seen as a bid to fend off a possible challenge from Peltz. Former Illumina CEO Francis deSouza won’t seek reelection to the board.
“While James Gorman and Sir Jeremy Darroch represent an improvement from the established order, the addition of those directors won’t, in our view, restore investor confidence or address the foundation cause behind the numerous value destruction and missteps that this Board has overseen,” Trian said in an announcement.
Disney shares are up about 6% this 12 months, far underperforming the S&P 500. The stock was flat Thursday. Later within the day, the corporate said it will reinstate its dividend at 30 cents a share for shareholders of record as of Dec. 11, payable Jan. 10. Iger had said earlier this 12 months Disney would bring back the dividend, which it suspended in early 2020 through the first days of the pandemic.
Trian said it owns about $3 billion in Disney stock. The firm has oversight of shares owned by former executive Perlmutter, a critic of Disney chief Bob Iger whom the corporate fired earlier this 12 months.
Disney fired back Thursday, saying Perlmutter has an ax to grind against Iger. Perlmutter has long complained that Disney had spent an excessive amount of.
“Mr. Peltz, in partnership with Isaac Perlmutter, a former Disney executive, intends to take its case to shareholders. Mr. Perlmutter owns 78% of the shares that Mr. Peltz claims helpful ownership of, or greater than 25 million of the 33 million shares,” Disney said in an announcement.
“This dynamic is relevant to assessing Mr. Peltz and some other nominees he may put forth as directors, as Mr. Perlmutter was terminated from his employment by Disney earlier this 12 months and has voiced his longstanding personal agenda against Disney’s CEO, Robert A. Iger, which could also be different than that of all other shareholders,” the corporate added.
Peltz had earlier pushed for a seat on Disney’s board after Trian took an roughly $800 million stake in Disney. After Iger unveiled a broad restructuring of the corporate in February, enacting layoffs and value cuts, Peltz backed off a proxy fight.
But Peltz reignited his push within the lead-up to Disney’s quarterly earnings report earlier this month. The activist investor had been waiting to see what happened with the report to make your mind up whether to make a move, CNBC previously reported.
Iger on Tuesday said he was focused on “constructing again” and intends to focus efforts on theme parks, ESPN’s upcoming streaming service and improving the studio business.
– CNBC’s Alex Sherman contributed to this report.
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