If at first you don’t succeed, try again. That old adage is proving true for an activist investor who is insisting on gaining a seat on the board of directors for ABC Owned Stations and ESPN parent The Walt Disney Co.
Nelson Peltz, the 81-year-old who serves as non-executive chairman of Madison Square Garden Co., Sysco and The Wendy’s Company, has moved forward with another proxy battle at Disney.
The move comes after the company snubbed Peltz for a board seat, igniting Peltz’s desire to take a role in which he can convince CEO Bob Iger to initiate greater revenue-generating programs.
Peltz is a principal at Trian Partners fund, with Peter W. May and Edward P. Garden. It holds a reported $3 billion equity interest in Disney, and in a statement released Thursday said it wants to bring its “case for change directly to shareholders.”
In particular, Trian notes that Disney shareholders have lost about $70 billion of value since February, when it gave the company “the opportunity to prove it could ‘right the ship.’” Peltz opted to give Iger the benefit of the doubt when he revealed an initiative that would reduce expenses and increase profitability for Disney+.
With the animated feature film Wish shaping up to be a Box Office flop, there is increased pressure on Disney to deliver profit-making products.
By October 27, Disney shares fell as low as $79.33 before enjoying a sharp rebound to $96.06 as recently as November 24. As of 2pm Eastern on Thursday, DIS, which trades on the NYSE, was priced at $92.65.
For Peltz, that’s not good enough. Then, there’s the lack of a dividend payment to shareholders, which was suspended after December 2019. “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 a statement.
Disney disagrees, stating it has “a proven track record of delivering long-term value to our shareholders and is in the midst of a significant transformation.”
Bring a flair of the dramatic to the situation is Peltz’s relationship with ex-Disney executive Isaac Perlmutter, who Financial Times says holds 78% of the Disney stock that Trian claims to have beneficial ownership of. Perlmutter is a Iger dissenter, and was dismissed from the company earlier in 2023.
With Peltz putting together a proxy battle, Disney nominated soon-to-depart Morgan Stanley CEO James Gorman and a former head of UK-based Sky, Jeremy Darroch.
For Gorman, he is also expected to join Disney’s “succession planning committee” — word that comes after Iger, 72, said he would “definitely” step down at the conclusion of his contract in 2026.