Disney’s Iger Wins Proxy Vote Over Peltz With Board Election

Thomas Buckley and Crystal Tse
·3 min read

(Bloomberg) -- Walt Disney Co. shareholders handed Chief Executive Officer Bob Iger a big vote of confidence, rejecting dissident investor Nelson Peltz’s bid for a board seat at the giant entertainment company.

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Shareholders elected all of Disney’s choices for the board, turning aside the nomination of Peltz, executives announced Wednesday at the company’s annual meeting. Investors also rejected Peltz’s ally, former Disney finance chief Jay Rasulo, and a slate from Blackwells Capital LLC, another dissident group.

The result is a clear-cut victory for Iger, 73, who has fought to keep Peltz off the board since returning as CEO in November 2022. In recent months, Iger has sought to address investor concerns by settling a political dispute with Florida, bringing on new directors to oversee succession and promising a profit soon from the company’s streaming business.

Peltz’s Trian Fund Management LP holds a Disney stake worth more than $3.5 billion and has been agitating for seats to address lagging shareholder returns and what he sees as inadequate corporate governance.

Disney investors saw it differently, with Peltz garnering just 31% of the votes cast, according to people familiar with the matter. Rasulo received even less support, said the people, who asked not to be identified discussing results that haven’t been announced publicly. Iger was reelected with 94% support.

“This is also our second go around with Disney, and we hope this will be our last and shareholders won’t be let down like a year ago,” Peltz said at the meeting before the vote was announced. “Regardless of the outcome of today’s vote, Trian will be watching the company’s performance.”

In a statement after the vote, Trian said it’s “proud of the impact we have had in refocusing this company on value creation and good governance.”

Blackwells said in a statement its “primary objective was achieved — keeping Nelson Peltz out of the Disney boardroom.”

Shares of Disney fell as much as 2.9% to $119.30 in the wake of the vote. The stock was up 36% this year through the close Tuesday.

Read More: Disney Wins Proxy Battle as Near-Term Trends Unaffected: React

In the run-up to the annual meeting, Iger and the board won the support of proxy adviser Glass Lewis & Co., JPMorgan Chase & Co. CEO Jamie Dimon and large shareholders such as George Lucas, Laurene Powell Jobs and members of the Disney family.

Peltz garnered the support of proxy advisers Institutional Shareholder Services and Egan-Jones, and marshaled backing from current and former directors of Procter & Gamble Co., Mondelez International Inc. and Janus Henderson Group Plc, where he previously had board roles.

Iger returned to lead Disney more than a year ago to replace his handpicked successor, Bob Chapek. Under Chapek, Disney incurred steep losses from streaming. It also engaged in a fight with Florida’s Republican Governor Ron DeSantis over state legislation restricting the discussion of gender in public schools.

In his second term, Iger has cut annual costs by $7.5 billion, eliminated 8,000 jobs and begun to address the flagging performance of the company’s movie business. He’s outlined plans to make Disney’s flagship sports programming from ESPN available to online viewers and unveiled a sports streaming venture with competitors.

The company has also designated a panel of board members to oversee finding a successor to Iger, whose contract runs through 2026.

In addition, Disney has reinstated its dividend, announced plans to invest $60 billion in its parks and resorts over the next 10 years and deepened its involvement in the video-game business via a $1.5 billion investment in Epic Games, the maker of the popular Fortnite title.

(Updates with Blackwells comment in eighth paragraph.)

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