Walt Disney said it’s won the support of ValueAct Capital Management for its board nominees and will consult with the activist investor on strategy, as the world’s largest entertainment company responds to pressure to boost performance.
ValueAct has signed a confidentiality agreement that enables Disney to provide the firm with additional information, the two companies said in a statement on Wednesday.
The world’s largest entertainment company has been under pressure from investors to improve its performance following billions of dollars in losses at its streaming services and a string of disappointing movies from its film studio. Iger, who returned as CEO last November after the ouster of his successor Bob Chapek, has committed to cutting billions in annual expenses and has already eliminated 8,000 jobs.
In yet another twist in Disney’s activist saga, activist hedge fund Blackwells Capital was said to be nominating three directors at Disney to rival Peltz. Blackwells is supportive of Iger’s work and is offering nominees who believe new board members could help him, Reuters reported, citing people familiar with the matter. The firm objects to electing Trian’s nominees, who are critical of the company’s strategy, Reuters said.
Disney has nominated Morgan Stanley Chairman James Gorman and veteran media executive Jeremy Darroch to join its board of directors this year.
ValueAct Chief Investment Officer Mason Morfit said Wednesday that Disney has the best intellectual property, sports brand and theme park assets and can lead the media industry forward as legacy technologies transition to digital platforms. Iger said the company has had “very constructive” conversations with ValueAct over the past year.
“ValueAct Capital has a track record of collaboration and cooperation with the companies it invests in,” Iger said in the statement. “We welcome their input as long-term shareholders.”
Iger, who ran Disney for 15 years through 2020, rejoined the company in 2022 following the ouster of his successor, Bob Chapek. Trian has criticized how closely connected Iger is to the current board.
The entertainment company has been under pressure from investors to improve its performance following billions of dollars in losses at its streaming services and a string of disappointing movies from its film studio.
Disney shares, up about 2% in the last 12 months, rose 0.5% to $90.71 in New York on Tuesday.
Blackwells is nominating Jessica Schell, a former Warner Brothers executive with expertise in content distribution; Tribeca Film Festival co-founder Craig Hatkoff; and Leah Solivan, who founded and headed TaskRabbit, according to Reuters.
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