The Disney board may have used this week's Emmy Awards as an excuse to binge-rewatch HBO's Succession, because there's an awful lot of talk circulating right now about changes in the board, proxy votes and plans of succession.
According to CNBC, activist investor Nelson Peltz (not to be confused with Disney-owned Simpsons bully character Nelson Muntz) is making a strong push to join The Walt Disney Company's board of directors, along with former Disney CFO Jay Rasulo.
Peltz’s Trian Fund Management officially nominated Peltz and Rasulo to the media conglomerate's board on Thursday in a proxy filing, making their case by highlighting a list of initiatives and performance targets they'd pursue if elected.
The two men vowed to “finally complete a successful CEO succession,” referencing the HBO-drama-level messiness surrounding the choosing of a chief executive officer to one day replace Bob Iger. Iger repeatedly delayed his retirement date and then infamously returned to his Disney CEO role when his first attempt at a replacement, Bob Chapek, was ousted by the board.
The proxy filing also stated that the new prospective board members would “align management pay with performance,” which apparently is some next-level Wall Street shade-throwing directed at Bob Iger for making $31.6 million last year, despite Disney's unimpressive stock valuation on the S&P 500 for 2023.
Trian Fund Management elaborated that it wants to achieve “Netflix-like margins” of 15% to 20% profits by 2027. Peltz specifically singled out Netflix as Disney's biggest competition in the filing.
Iger was brought back as CEO to try to streamline the ever-expanding multimedia company, to rein in spending, and to make its Disney+ streaming platform profitable. To that end, he's initiated a massive internal restructuring of Disney's operations, including laying off thousands of employees.
Peltz told CNBC that he believes Disney’s current board oversight is “awful.”
“They said I have no media experience — I don’t claim to have any,” Peltz told his Squawk Box interviewer on Thursday morning. “But I will tell you, I don’t think they have much media experience.”
All you need is that haunting Succession musical score and a snarky reaction from Roman Roy and you've got another Emmy-winning episode on your hands.
So far, Disney has rejected Peltz's thirsty board push like he's a kid too short to ride Space Mountain.
Peltz, who is Chairman of the board of directors of Wendy's, also mentioned in the proxy filing what he sees as the “crown jewel” (or square hamburger) of Disney — ESPN. Peltz stressed his desire to build out the sports platform with a strong business plan (although this is already high on Iger's list of priorities as well).
Peltz is also calling for a change in how the Disney studios function creatively, calling for a board-led review of material in order to “restore leadership accountability” and return Disney to box office supremacy. Yes, because nothing helps the creative process of artists like a roomful of Wall Street executives giving their notes from a financial standpoint.
Peltz and Rasulo also addressed theme park operation in the filing, explaining their goal as “high-single digit operating income growth,” which appears to just be fancy talk for let's make more money.
In Peltz's CNBC interview, he offered a lovely personal anecdote about going to Disney World last week. “It was fascinating because … we didn’t have any special passes. We didn’t have any tour guides … Everybody was nice. I mean, Magic Kingdom and the Hollywood Studios — terrific,” Peltz explained. “All the employees were smiling, and that’s probably in large part because they didn’t own any Disney stock.”
Sick burn, Nelson! Now it will be interesting to see how Logan Roy — er, Bob Iger — responds to Peltz's art-imitates-life push to join the Disney board. Will Iger flip him like a Wendy's burger? Or sue him silly like Iger did in his standoff with Ron DeSantis? However this gets resolved, one thing is clear — don't mess with the Mouse.
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