Disney Proxy Fight: Institutional Shareholder Services Backs Nelson Peltz for Board
In a blow to Disney, a major proxy advisory service on Thursday told investors that change is needed at the House of Mouse, and recommended support for activist shareholder Nelson Peltz’s effort to obtain a seat on the company’s board.
Institutional Shareholders Services’ recommendation was not, however, a full-throated endorsement of the proxy fight led by Peltz, CEO of Trian Capital Management. ISS recommended that Disney shareholders vote for Peltz, but against Trian’s second nominee, former Disney exec Jay Rasulo.
Peltz would presumably replace current board member Maria Elena Lagomasino, who has served on the board since 2015, and got a thumbs down from ISS.
The service also recommended that shareholders withhold their votes for the second slate of activist shareholder nominees, backed by Blackwells Capital: Craig Hatkoff, Jessica Schell, and Leah Solivan.
The recommendation ran counter to another top advisory service’s view. Glass Lewis on Monday backed all 12 Disney director nominees, pointing to The Walt Disney Company’s clear strategy, its strong additions to the board and “measurable shifts” in the business since the return of CEO Bob Iger in late 2022.
But it was Iger’s return after the disastrous three years with Iger-chosen Bob Chapek at the helm that troubled ISS and led to its support for Peltz.
“The fact that Disney’s ship was taking on water is obvious,” ISS wrote in its analysis. “Iger’s return may have been sufficient to plug the holes, and management has since taken several actions to plot a better course. With any luck, the favorable winds of renewed cinematic success should convince shareholders that Disney is again headed for safer ports.”
“What remains missing is tangible progress towards succession to give investors sufficient confidence that the company will not run aground after Iger departs, and in doing so, avoid future mutinies,” the analysis continued.
This is a developing story, more to come…
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