Walt Disney has named a new chief executive officer and indicated it also faces a proxy fight as Nelson Peltz’s Trian Group seeks a board seat for the activist investor as opposed to the company’s slate.
“The board does not support Trian Group’s nominee and recommends that shareholders do not endorse the nominee and instead vote for all of the company’s nominees,” Disney said.
Disney’s said the board elected Mark Parker as chairman, effective at its annual shareholder meeting. He has been a director of Disney and also CEO of Nike for the past seven years. He succeeds Susan E. Arnold, who is not seeking re-election under the 15-year term per Disney board policy. This reduces the council to 11 members.
Disney has a fiscal year in September and usually issues its proxy statement — which lists, among other things, the company’s list of directors up for election — in January and holds its stockholders’ meeting in March. Investors could allow Delcare’s opposition board candidates to push for change, leading to a so-called proxy fight. You can also submit shareholder proposals. In addition to the measures to be voted on, Trianon also wants Disney to change its charter.
It’s been a tumultuous time for the company, culminating in an abrupt change in CEO in November when Bob Iger returned to take the reins from Bob Chapek. Disney said it remains “open to constructive engagement and ideas that help increase shareholder value,” even with Trian. It cited Iger’s track record of shareholder value as CEO, noting that the executive “has already taken significant steps to refocus content creation and distribution and reposition Disney’s streaming platforms and linear broadcast and cable networks to achieve greater profitability for the company.” ” .
Iger has a two-year contract. With succession planning having gone awry last time, Trian wants to make sure Disney plans this next round right, according to the WSJ. Disney noted that Parker will chair a newly formed succession planning committee and review internal and external candidates.
The WSJ said Trian executives met Tuesday with Disney executives, including Iger and CFO Christine McCarthy, to reach an agreement and avoid a proxy fight, and that Arnold Peltz called this morning to offer him an observer role. of the council and asked him to sign a standstill agreement, which he refused.
Another activist investor, Dan Loeb, was excited last year that Disney should spin off or sell ESPN, but backed off in September, saying he had a better understanding of the asset’s value to the broader company.
In a note released today titled “Restore The Magic,” Trian said Disney is at a crossroads. “It may decide whether to consider adding a qualified board member OR a partner with Trian to create sustainable long-term value at Disney.”
“We believe current investor sentiment toward Disney is low, reflecting the hard truth that Disney is a troubled company and faces many challenges that weigh on the company’s investment prospects.”
“While we recognize that Disney, like many other media companies, is making a challenging transition to streaming, we believe that many of the company’s current issues are self-inflicted and need to be addressed. Disney because of our experience investing in and serving on the boards of blue chip companies, working with management teams and boards to optimize corporate governance, strategy, operations and capital allocation.
Statement from Disney:
“Mark Parker is an incredibly well-respected leader who has served as a Disney executive for more than seven years, helping to effectively lead the company through a period of unprecedented change,” Arnold said. “During his four decades at NIKE, Mark has led one of the world’s most recognized consumer brands through several market developments and a successful CEO transition, and he is uniquely positioned to chair the Disney Board of Directors at this stage of transformation. ”
“Mark Parker’s vision, incredible experience and wise counsel have been invaluable to Disney, and I look forward to working with him and our other directors in his new role as we chart the future course for this great company,” said Robert A. Iger said. Chief Executive Officer of The Walt Disney Company. “On behalf of my fellow board members and the entire Disney management team, I want to thank Susan for her outstanding leadership as chairman and for her tireless work over the past 15 years as a model steward of the Disney brand.”
Mr. Parker said, “I am honored to have the opportunity to serve as Disney’s chairman and I look forward to working closely with Bob and his management team on a growth strategy that balances investment and profitability while supporting Disney’s core mission of … creative excellence is supported. delivering shareholder value. At the same time, identifying and preparing a successful CEO successor is a top priority for me and the Board, and this process has already begun.”
Mr. Parker will also chair a newly formed Board Succession Planning Committee, which will advise the Board on CEO succession planning, including the evaluation of internal and external candidates. Mr. Parker was Chairman and CEO of NIKE until 2020 when he became Executive Chairman.
The Board of Directors of The Walt Disney Company has continued to evolve to ensure they have the right combination of backgrounds, skills and perspectives to lead the company into the future. Today, Disney directors bring experience across a range of relevant disciplines, including branding, marketing and retail expertise, direct-to-consumer expertise, and technology and innovation.
The Board of Directors nominates incumbent directors Mary T. Barra, Safra A. Catz, Amy L. Chang, Francis A. deSouza, Carolyn Everson, Michael BG Froman, Robert A. Iger and Maria Elena Lagomasino for re-election at the companies’ annual meeting. , Calvin R McDonald, Mark G Parker and Derica W Rice.
The board responds to Trian Partners’ nomination by recommending that shareholders vote for all of the company’s nominees
Trian Partners LP and Trian Partners Parallel Fund I, LP, wholly-owned subsidiaries of Trian Fund Management, LP, together with other affiliates of Nelson Peltz (collectively, the “Trian Group”) nominated Nelson Peltz for election as a director at the annual meeting rejected the nominees recommended by the board and introduced a proposal to amend Disney’s charter.
The Walt Disney Company remains open to constructive participation and ideas that help increase shareholder value. While The Walt Disney Company’s management and board together with Mr. Peltz, the board does not endorse the Trian Group nominee and recommends that shareholders not endorse the nominee and instead vote FOR. all nominated companies (listed above).
The Walt Disney Company has built a long track record of financial and creative success on its ability to leverage its rich intellectual property and unparalleled storytelling across its many businesses, from cinema, streaming and linear broadcasting to parks and resorts, and is one of the largest resonant. names in esports, ESPN. Mr. Iger’s mandate is to use his two-year tenure and extensive industry experience to adapt the business model to the changing media landscape, rebalancing investments with revenue opportunities, while bringing a new focus to the creative talent that drives The Walt Disney Company. the industry. Mr. Iger has already taken significant steps to refocus content creation and distribution and reposition Disney’s streaming platforms and linear broadcast and cable networks to increase the company’s profitability.
During Mr. Iger’s first term as CEO from September 2005 to February 2020 saw the Company’s total shareholder return of 554%, which exceeded the S&P 500’s total shareholder return of 244%. The company’s market capitalization quintupled during his tenure, from $48 billion to more than $230 billion.
The Board of Directors of The Walt Disney Company is continually renewed, with an emphasis on board members whose industry experience contributes to the company’s strategic priorities. The average tenure of the current board is four years, with three directors serving less than two years, and in addition, the board is led by an independent chairman.
The Company expects to file preliminary materials regarding its 2023 AGM shortly and looks forward to communicating with its shareholders once final proxy materials are available. The date of the annual meeting has not yet been announced.
Writer: Jill Goldsmith
Source: Deadline
Elizabeth Cabrera is an author and journalist who writes for The Fashion Vibes. With a talent for staying up-to-date on the latest news and trends, Elizabeth is dedicated to delivering informative and engaging articles that keep readers informed on the latest developments.
