In the end, veteran investor Nelson Peltz came away with a big win in his battle with the Walt Disney Co.
Peltzâs Trian Fund Management sold its Disney shares after Peltz lost his hard-fought campaign to join the Burbank entertainment giantâs board of directors and exert influence over the Magic Kingdom.
Last month, Disney shareholders rejected the billionaireâs proxy bid, but Trian still profited by selling its Disney stake to reap about $1 billion on its investment, according to business news network CNBC, which quoted an unnamed person familiar with the matter.
Trian reportedly capitalized on Disneyâs recent run-up in stock price, when shares traded at about $120 in early April.
Since then, Disneyâs stock has fallen. Shares were hovering around $101 on Thursday.
Still, Disney is up 12% since the beginning of the year as Chief Executive Bob Iger seeks to demonstrate that heâs properly managing the company to achieve success in the streaming era.
While Disney strenuously campaigned against Peltz and his ally, former Disney executive Jay Rasulo, the company has heeded some of Peltzâs calls, including implementing rounds of rigorous cost-cutting, resulting in about 8,000 positions being eliminated.
Representatives of Trian and Disney declined to comment.
In what became Disneyâs most consequential board election in 20 years, Peltz repeatedly hammered the company for its missteps and bungled succession efforts.
Peltzâs proxy campaign zoomed in on Disneyâs subpar stock performance over the last five years, uneven box-office results and $71-billion purchase of much of Rupert Murdochâs 21st Century Fox, which provided Disney with more library content and intellectual property, including âAvatar,â âThe Simpsons,â and âDeadpool.â Peltz and some analysts viewed the Murdoch deal as a costly mistake.
Another sore point was Disney board membersâ decision to hire Bob Chapek as CEO four years ago and extending Chapekâs contract less than six months before directors forced him out. Chapek, who was Igerâs handpicked replacement, made several costly blunders, including allowing Disney to become fodder for the culture war campaign of Florida Gov. Ron DeSantis.
Disney also racked up billions of dollars in losses on streaming.
Peltz unveiled Trianâs proxy fight last fall. It was his second stab at winning a board seat, but the activist investor withdrew his initial effort in early 2023 after Iger first announced his cost-cutting plans. Last fall, Peltz reportedly added to his Disney stake. In October, the stock was trading below $90 a share.
Iger received 94% of shareholdersâ support â a clear victory that reinforced his popularity among large institutional investors as well as small shareholders who are nostalgic for the company, its characters and theme parks. Three-quarters of âretailâ shareholders (as opposed to larger institutional investors, such as mutual funds) voted in support of Disneyâs slate of 12 board nominees, which included Iger.
Despite their proxy battle victory, Iger and his management team remain under pressure to accelerate the companyâs turnaround plans, including efforts to make its streaming business profitable. Disney must preserve the power of its ESPN sports empire, and other TV channels, while also reinvigorating its movie pipeline and expanding its theme parks and resorts business.
Disney has announced a $60-billion investment in theme parks, resorts and cruise lines over the next decade. In April, the Anaheim City Council approved a $1.9-billion expansion plan for the sprawling Disneyland Resort.
Disney board members must also find a capable successor for Iger â a duty that has eluded the company for years. Igerâs current contract runs through 2026.
Staff writer Samantha Masunaga contributed to this report.