Disney CEO Bob Iger has successfully convinced shareholders to vote for his preferred board, ending one of the most expensive boardroom battles in history.
It is a major triumph for Disney veteran Iger, who has for months been trying to stave off a hostile takeover orchestrated by prolific activist investor Nelson Peltz.
All 12 of Disney’s preferred nominees were elected to the board by a ‘substantial margin,’ it was revealed during the company’s annual shareholder meeting on Wednesday afternoon.
Peltz’s firm Trian Partners was asking shareholders for two seats – one for him and another for Disney’s former chief executive officer Jay Rasulo.
He argued that Disney ‘lost its way,’ and pointed to the entertainment giant’s recent lack of box office hits and failed succession in 2020.
Bob Iger’s victory in the proxy fight will boost his standing in the coming months and help him to enact a second succession plan
Bob Iger successfully convinced shareholders to vote for his preferred board during Disney’s annual shareholder meeting on Wednesday
Shareholders voted on which 12 people they wanted to serve on the board for the next year. Peltz was supported by 31 percent of voting shareholders, whereas Iger had the backing 94 percent. Those that voted for Peltz may have also voted for Iger.
‘With the distracting proxy contest now behind us, we’re eager to focus 100 percent of our attention on our most important priorities: growth and value creation for our shareholders and creative excellence for our consumers,’ Iger said in a statement.
He attempted to instill confidence investors, noting that Disney was working on an ‘robust slate’ of films. Among them are Mufasa, Deadpool and Wolverine, and Inside Out 2.
In the moments after the results were announced, Disney shares were down 1.8 percent for the day, at $120.69.
Shortly after the meeting started, Peltz was invited to address shareholders and took credit for a recent uptick in the value of the Walt Disney Company stock.
He endorsed a number of its leadership’s decisions in recent months, including its plans for a bulked-up ESPN streaming service. ‘But Trian still has concerns,’ he said. ‘The long-term track record still remains disappointing.’
‘We want Disney to get back to making great content and delighting consumers,’ he added.
Retail investors make up about a third of Disney shareholders and voted overwhelmingly in favor of the existing leadership.
Iger’s victory in the proxy fight will boost his standing in the coming months and help him to enact a second succession plan after his departure from the company in 2020 failed.
Although Trian’s failure to win the seats is a blow to Peltz, the investor has taken credit for recent gains to Disney’s share price. ‘We hope this campaign has had a positive impact on Disney,’ he said.
During the shareholder meeting he pointed out that Disney as of Wednesday was the best-performing stock in the Dow Jones Industrial Average this year.
Trian’s failure to win the seats is a blow to Peltz, but he took credit for gains this year to Disney’s share price
Peltz had nominated himself and former Disney CFO Jay Rasulo (right) to the board of the entertainment giant’s directors, slamming Iger as ‘underperforming’
During his campaign, Peltz attacked Disney for producing ‘woke‘ films that underperformed at the box office.
He has long been an advocate of taking the politics out of America’s boardrooms and focusing on delivering returns for shareholders.
Activist investors like Peltz often believe that they can unlock the value of a company by advocating for changes to its leadership and strategy.
In open letters to Disney investors, Peltz has been critical of the company’s heading under Iger’s leadership.
In particular, he has criticized the CEO’s botched attempt at establishing Bob Chapek as his successor in 2020.
After 15 years as CEO, Iger picked Chapek to take over the company but did not last long. In November 2022, he was ousted by the board and Iger was reappointed as CEO.
Both Disney and Trian spent tens of millions of dollars on their respective campaigns, launching public and personal attacks and trying to persuade voters.
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