Bob Iger Has Won the Proxy War With Nelson Peltz at Disney Shareholders Meeting
The Walt Disney Company (DIS) shareholders denied activist investor Nelson Peltz’s bid to join the company’s board during the annual shareholders meeting today (April 3). Instead, they voted to elect all 12 of Disney’s own nominees to the board with a “substantial margin,” according to Disney’s head of legal and compliance, Horacio Gutierrez.
Peltz had sought two seats on Disney’s board, with the second for Jay Rasulo, a former Disney chief financial officer, on behalf of his hedge fund, Trian Partners. “It is undeniable that shareholders have suffered for the last few years,” Peltz said to shareholders tuning into today’s meeting.
Disney shares fell about 3 percent to below $119 today after the shareholders meeting. The media giant’s stock price has fallen 40 percent from its peak of almost $200 in March 2021.
Disney CEO Bob Iger, after securing a win against the billionaire hedge fund manager, called the proxy contest “distracting” and reinforced his eagerness to focus on the future. Iger closed his statement announcing expansions to Disney theme parks across the world, sequels to the Inside Out and Moana franchises, and new streaming partnerships in sports entertainment, promising that Disney is investing in its growth. This is the second year Disney has fended off an activist challenge from Peltz.
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In the lead-up to the vote, Peltz had earned the support of the former Marvel chief Ike Perlmutter, who had helped increase Trian’s stake in Disney to around $3.5 billion. Trian has been running ads to promote its bid and has maintained the website RestoreTheMagic.com advocating for Disney to implement a proper CEO succession plan for Iger, who was going to retire but brought back as CEO in November 2022, and take on other cost-cutting measures.
Peltz had also earned support from the California Public Employees’ Retirement System, which owns 6.6 million Disney shares, and the Institutional Shareholders Services, an influential proxy advisory service. On Iger’s side, he had the support from Vanguard and BlackRock, which own 12 percent of Disney, and public endorsement of renowned Disney investors George Lucas, Laurene Powell Jobs and Disney family members.
Disney had encouraged its shareholders not to support Trian, arguing Peltz “had not actually presented a single strategic idea for Disney.” Trian, however, argued it aims to help Disney attain Netflix-like profit margins, as per its 2024 filing: Netflix had a 20 percent net profit margin in 2023’s third quarter, while Disney’s was 1.24 percent.
The proxy vote became one of the most expensive in history, with Trian and Disney spending $25 million and $40 million, respectively, on their campaigns to woo shareholders, as per security filings.