Disney heirs line up against Nelson Peltz and activist investors


It’s a classic Disney movie plot: a family comes together to fight an enemy.

Only this time it’s happening in real life, with the grandsons of Walt and Roy Disney, who founded the company in 1923, joining forces to oppose Nelson Peltz, the activist investor who is waging a battle for board seats. The heirs — nine in total, including Abigail E. Disney, who has at times been a harsh critic of Robert A. Iger, Disney’s chief executive — publicly supported Iger and Disney’s current board of directors on Thursday.

“These activists must be defeated,” Roy P. Disney, 66, said by telephone. “They are not interested in preserving the magic of Disney, but in stripping it to the bones to make quick profits for themselves.”

In a statement, a spokesperson for Trian Partners, the investment firm Peltz runs, said: “We love Disney and recognize that leveraging its rich history to delight its loyal fans is essential to its future success. Trian invests in great companies like Disney and helps them grow and prosper over the long term, and we have the track record to prove it in companies like P&G, Heinz and Mondelez.”

Mr. Disney, grandson of Roy Disney, has three siblings: Abigail, Susan Disney Lord and Tim Disney. In a letter to Disney shareholders, which was seen by The New York Times, they call Peltz and a handful of other activist investors surrounding Disney “wolves in sheep’s clothing.”

“It is imperative that the strategy that Bob Iger, his management team and the board of directors have implemented is not affected,” the letter says. His cousins, grandchildren of Walt Disney, sent a letter of their own echoing those sentiments.

Abigail Disney, 64, whose 2022 documentary, “The American Dream and Other Fairy Tales,” attacked Disney over pay inequality, added by phone: “I have my differences with Bob Iger, but I know for a fact that the worst What could happen to the company is Nelson Peltz.”

Peltz, 81, is campaigning for two seats on Disney’s 12-person board, one for himself and one for James A. Rasulo, 68, a former Disney chief financial officer who left in 2015 after having been ignored as Iger’s heir. apparent. Peltz is aligned with Ike Perlmutter, 80, a former Disney employee who is one of the company’s largest independent shareholders. Perlmutter, who sold Marvel Entertainment to Disney in 2009, was ousted from the company last year.

Perlmutter had campaigned, from his position within Disney, for Peltz to join the board in 2022. When he was rejected, Peltz launched a proxy battle, saying he would cut costs, revamp Disney’s streaming business and clean up the the company’s messy succession planning. He retired after Disney restructured and announced $5.5 billion in cuts. (It ended up close to $7.5 billion.)

The pair resurfaced in October, citing Disney’s languishing stock price and mishandling of Disney’s leadership succession plan.

“Basically and crudely, we want the stock to go up,” Peltz says in a video message on Restore the Magic, a site that makes his case for a board shakeup. In a video posted to X on Wednesday, Peltz said, “We love Disney. “We think it’s part of American culture.”

This month, after Disney reported strong quarterly results and announced a partnership with Epic Games, shares soared. Disney was trading at around $111.50 on Thursday, up 23 percent since the beginning of the year. However, shares peaked at nearly $200 in March 2021.

The standoff over Disney extends beyond Peltz. Blackwells Capital, a hedge fund, is seeking three seats on Disney’s board, saying Iger, 73, needs help navigating the rapidly changing media and technology businesses; Disney opposes the effort. Another activist investor, ValueAct, is backing Disney amid challenges from Trian and Blackwells.

The proxy battles will come to a head on April 3, when Disney holds its annual shareholder meeting. (It will be done online).

“I approach each day at Disney with a deep sense of respect for everything Walt and Roy created, and it is incredibly meaningful to have the support of their families,” Iger said in an email. “We are committed to protecting his legacy as we chart Disney’s path forward.”

The Disney family has not been involved in the management of the company since Roy E. Disney, the father of Abigail, Susan, Tim and Roy P. Disney, resigned from the board of directors in 2003. He subsequently led a shareholder revolt that resulted in Michael D. Eisner’s resignation as CEO and Iger’s rise to the top of the company. Roy E. Disney died in 2009.

It’s worth noting that the Disney family previously ran an activist investment fund, Shamrock Holdings, which played a major role in the 2003 restructuring of what was also an underperforming Disney company.

Roy P. Disney said he and his family members continue to own shares; He declined to size the stakes, but analysts say the Disney family has a relatively small position. He said Disney did not ask for his help in their fight to defend themselves against Peltz and his fellow activists. He said they decided to speak out because Peltz’s campaign reminded them of a bitter episode from 1984, when corporate raider Saul Steinberg took over the company. In the end, Steinberg was defeated.

Disney and his siblings were joined Thursday by five cousins ​​(Walter Elias Disney Miller, Tamara Diane Miller, Jennifer Miller-Goff, Joanna Sharon Miller and Michelle Lund) who also expressed their support for Iger, although with less emotion.

“As the Walt Disney family, we support the management of the Walt Disney Company and its board of directors, and we oppose the nominations submitted by Nelson Peltz,” they said in their letter. “There have been difficult times, but this current administration has adapted and grown through those challenges.”

Michelle Lund, whose mother, Sharon Disney Lund, was one of Walt Disney’s daughters, added in an email: “Disney started as a family business and although it has grown into a large global business, Disney is still a family. . “My mother would be horrified by the attempts of these activists to force their way into the company.”

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