Nelson Peltz has reentered the Disney story like a villain even Walt himself couldn’t have dreamed up.
©New York Times Nelson Peltz of Trian Partners
After throwing his name into the ring for a position on Disney’s Board of Directors, Peltz initiated a proxy battle for the spot which ultimately ended before it began, with Peltz pulling out of the fight and declaring his support for Disney and CEO Bob Iger. But, with Disney stock prices at their lowest point in nearly 10 years, Peltz is back — and it sounds like he isn’t too happy.
Over the past year, Activist investor Nelson Peltz and Trian Partners (Peltz is CEO of Trian Partners) began pushing for Peltz to have a seat on Disney’s Board of Directors before Peltz was even an investor in Disney. Peltz shared quite a few criticisms of the Walt Disney Company — notably CEO succession, poor financial strategy (especially when it comes to streaming), and not enough accountability with capital allocation.
But, that all changed after the first-quarter earnings call of Fiscal Year 2023 when Peltz suddenly declared that all was now copacetic between him and Disney. Shortly after, the proxy battle was over and Nelson Peltz was but a distant memory — until now.
©Disney | Walt Disney Company Headquarters
According to The Wall Street Journal, Peltz has increased his stake in The Walt Disney Company, with his Trian Fund Management having accumulated more than $2.5 billion in shares. Not only that, but Peltz is reportedly planning to push for one or more seats on Disney’s Board of Directors yet again.
©Reuters
Peltz and Trian are one of Disney’s largest investors and it’s expected that the company will be requesting multiple seats on the board, including one for Peltz, per “people familiar with the matter.”
If Disney says no as it has in the past, Trian could nominate directors to be voted on at the Disney Shareholders meeting being held next spring, thus starting the battle all over again. Disney’s window for shareholder nominations is between December 5th and January 4th.
Walt Disney Company Headquarters ©LA Times
After Peltz made his initial bid, Disney’s Board of Directors issued a notice on their website and sent a letter to shareholders on the matter. In their notice, the Board shared that they are “focused on delivering long-term sustainable value” and that they do NOT endorse Nelson Peltz (or his son, who was running as an alternate).
In fact, the board took it so far as to say that the “election of either Mr. Peltz or his son would threaten the strategic management of Disney during a period of important change in the media landscape.” But, things haven’t totally been looking up for Disney shareholders recently.
©Disney
Disney stock prices have taken a dive lately, hitting their lowest point since 2014. On the morning of October 5th, Disney stock (NYSE: DIS)prices were trading just below $80 per share at $79.24. According to data from Google Stocks, it was priced even lower at market close on October 4th at around $78.73.
Disney stock prices have steadily been decreasing year-to-date, as you can see in the graph below. At the beginning of 2023, prices were well over $100, and as it stands now Disney is lucky if they break $80.
It’s Peltz’s belief that Disney shares are “significantly undervalued” and the company needs a more focused board that is aligned with shareholders. In recent months, Trian has increased its stake in Disney to more than 30 million shares — a large increase from about 6.4 million shares it held at the end of Q2 of FY2023.
Disney World
A reason for the increase hasn’t been revealed by Peltz or Trian, but it does come after Bob Iger shared that Disney’s traditional cable assets “may not be core” to the company’s values, hinting that a potential sale could be on the way for ABC, ESPN, FX, Disney Channel, and more.
It’s interesting to note that Trian has a history of “encouraging changes” at companies it invests in, like selling underperforming divisions — something Disney and Iger have been increasingly interested in doing as of late. It’s unclear whether or not this is the end goal for Trian, but what is clear is that we haven’t heard the last of Nelson Peltz.
©Trian Partners
An official bid for a seat — or seats — on Disney’s Board of Directors has not yet been made by Peltz or Trian, and it’s possible we won’t until shareholder nominations officially begin later in December. As of now, Disney hasn’t commented on the potential for another proxy battle.
We’ll continue to keep an eye on this situation as it develops, so be sure to stay tuned to DFB for the latest.
Who Is Nelson Peltz and Why Do People Care What He Says About Disney?
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This is good news. Disney will never regain its prior glory with Iger in charge. Iger has to go. Iger doesn’t acknowledge many of Disney’s problems and because he is the architect of so many of Disney’s challenges, Iger is invested in the status quo, and doesnt want to change. Iger must go.
Igor’s #1 villain is Ron deathSantis not this guy!
Villain? No. Nelson Peltz is the hero in this story. It is Bob Iger who is the villain.
This seems to be a bit coincidental. He’s purchasing large amounts of stock while it’s at a low price, possibly hoping for more control. I don’t trust him to have the creative interests of Disney Corp at heart.
Disney is in trouble of its own making. It needs to change its culture and financial strategies. It has lost millions of customers because of its woke policies and billions in sales due to poor investment and pricing decisions.
ANNNNNNNND no one at Disney noticed the buy up????? Biggest problem I can see with the whole debacle is that the only people running, or trying to run Disney are totally shareholder focused. That can only bode ill for the parks and the patrons. Prices will rise as rides go unmaintained, parks go unkempt and cast get forgotten.
The magic is dying.
So basically this guy is trying to buy a seat on the board because he was not endorsed and nominated for the board. Sounds like a politician running for office. After all, you don’t win elections, you buy elections. The one one with the most money usually wins. Or in this case, get a seat on the board.
Agreed… Disney needs an outsider to come in and look thru a different set of eyes, much like when Michael Eisner came it. The growth at Disney for the next 15 years was historic. An insider like Iger sometimes can’t see the forest thru the trees, and that is where Iger is right now.
I seems that the strategy the board was trying to protect with their claim last year was their steady trajectory to rock bottom.
Iger uses the Parks as his Cash Cow to prop up other investment failures and we all get Less for More
Are you sure he won’t be another Bob Chapek? I’m in fear they will ruin my beloved Disney Parks.
Bob Iger’s No. 1 Enemy is Bob Iger. Iger refuses to acknowledge the three of four main problems at the heart of Disney’s challenges and by doing this, Iger is not discovering the true root causes so Disney can begin fixing them. Iger needs to go. Extending his newest contract was a mistake.
Disney’s stock price has gone up in anticipation of Nelson Peltz gaining control. As of Oct-12-2023, DIS is trading at $84.35. Peltz has a good track record of turning under performing companies around. He has stated he will refocus Disney on their core business and eliminate so-called “woke” and DEI distractions from the company.
In the 1980’s Disney adopted a popular at the time, but foolish business strategy: put off routine maintenance to maximize short term profit. We all have seen how this caused disrepair in the parks, long and expense refurbishments and a reduced guest experience.
Decades later, another ill-fated policy was adopted: don’t tell stories about love, heroic deeds, timeless tales of wonder, character and worth. Instead, spread “the Message” of the latest ideology de jour and political agenda of one part of society. This has resulted in massive losses in film and entertainment along with unnecessary theme park expenses to implement this policy.
As a result Disney is plunging into the abyss. It is my hope and belief Nelson Peltz can turn the Disney Company away from the financial ruin that is rapidly approaching.
I wish commenters would stop talking about “woke” policies. That’s not why Disney is in trouble.
I believe Disney will be SOLD. Most were cheering Chapek’s demise, but Iger and D”Amaro have given a few little discounts all while raising prices on others. We have plans for Jan., we were planning to get Genie+ a couple times, but the price has gotten outrageous. Now we find out food has gone up in price?
Kristin, Respectfully, how do you know that? Park attendance and movie viewership and Disney + subscriptions are down. These facts are not in dispute.
Unfortunately, these customers are no long available to ask them why they are not attending, going or watching. Many people replying to DFB and other blogs have said they are not going back until the culture war stuff is abated, if then. Disney is like a typical business in that the first 75% to 85% of their revenue covers costs, and any sales or revenue above that, is where they make their profit. It doesn’t take a huge drop off in sales volume to hurt Disney’s profitability. I do not know Disney’s exact accounting, but suspect they are rather typical in this regard.
In a recent meeting with investors, Iger said that he wanted to quiet down the culture war. Many news agencies reported that part. Iger’s complete statement was that he wanted to quiet down the culture war because it was hurting profits. I wish Disney would get rid of Iger sooner rather than later, but I think he does know some of the contributing elements to Disney’s decline in profitability. Bob, you can start quieting down the culture war today, if you really mean it. Kristin, the Woke Agenda really is impacting Disney’s profitability. Iger recently acknowledged it to be true.
Hi Randy. I don’t have any insider information or anything like that. But there are a few things that I think about whenever I hear people complain about “woke politics.” Number one is that those people are usually the ones online and are the loudest. Therefore people reading these things or listening to podcasts or news media think that everyone agrees with that line of thinking and so that must be why sales are down. I go to the parks quite a bit as I’m sure most people do who comment on Disney Food Blog, and no matter how much they say attendance is down or how much money Disney says they are losing, there are always people at the parks. So maybe they’re not making as much money as they want to or as much money as they have in the past, but they are making money.
Secondly, I think we have to look around at what is happening in the world and compare it to when Disney was most profitable. Economics and how people are basically trying to survive nowadays are much different than in Disney’s past and these things play a big part in whether families take an expensive vacation or not. My gut is that the people who are upset that Disney puts a gay character in a show and thus refuse to go to a park or cancel Disney plus are not making as much of a financial impact as other situations. My gut is that it’s simply that families cannot afford the things that they should be able to or used to.
Anyway, that’s where my viewpoint lies. Disney is not the only company struggling. The other day I bought 2 quarter pounder meals for my parents at McDonald’s and it was $20! Everything is way expensive because businesses are trying to cover losses.
I will say I’m a little disappointed that Iger doesn’t seem to be trying to instill wonder in the parks anymore. Everyone seems to have this huge push towards IP and I miss the days of Joe Rohde magic.
Thanks, Kristin. Joe Rohde was amazing as an Imagineer, wasn’t he? I hated to see him go, but everyone knows when retirement makes sense and it’s time to go. I just got back from MK an hour ago. It was not crowded today at all. Not So Scary is tonight, so the pattern is that a lot of families opt for other parks, rather than having their MK day cut short, if they are not staying for Not So Scary. I agree that inflation is impacting all discretionary spending these days, and Disney is probably being impacted by this in a major way due to how costly it is to vacation there. The recently announced price increases will only make this worse. Iger recently told a group of investors that the Culture War is hurting Disney’s profitability and that he would quiet down Disney’s role in the Culture War. I believe Iger has studied the financial impact of the Woke policies and told the investors the truth. Enough people have said this now that I am starting to believe it, that it is hurting business. My family and I have had one of the best visits to WDW this week in a long time. The cooler weather and smaller crowds and shorter wait times all contributed to this. I do not not support the position Disney has taken in the Culture War, especially Florida’s Parental Rights in Education law. But no one shoved Woke politics near us this week so far and it’s been wonderful. The feeling is that some magic is missing still. Better said, new magic is missing. WDW is still relying on “SOSDD, Same Old Stuff, Different Day.” Fresh ideas and fresh new creative content are needed. Disney’s success is so integrated, it all starts with successful new creative releases. That is key to driving merchandise sales and theme park attendance. Woke remakes and so-so new releases are not favorably driving the Disney business model.
Randy, I totally agree with you, it is one thing to have changes in culture, but another thing to have it shoved in your face.
Iger is Iger’s problem. He cannot see the nuclear family as the stream of success. The creativity in the studios is null. The opinionated TV channels are a product of today’s society doing poorly. The values are not creating revenue because he keeps ignoring the fact its no longer affordable. Take people off the top and feed the bottom. I don’t know Peltz, but when you put “activist” in his title, doesn’t sound like the best fit for the brand. Eisner where are you? #saveDisney
I will never understand the viewpoint that Disney is “shoving ideology” into people’s faces. I can only assume you are talking about POC and LGBTQ people. These people exist. Period. And they have just as much right to be in stories, movies, and shows as the straight white people that have been in Disney movies for decades. If you don’t approve, then don’t watch the show. And if it upsets you that much, then don’t go to the parks. I don’t get why what Disney produces has to be what YOU decide it should be.
I live in Florida. Disney isn’t suffering from the whole “woke” nonsense. Many people here are tired of the Governor’s temper tantrum with Disney and what is happening here in terms of his My Way or the Highway thinking. Many people who might be going to Disney have put off trips for economic reasons, waiting to see if the Government will once again close down due to a “few” members of Congress who also share the “have it my way” rule (GAetz, ETc. Reading some of the above comments makes me wonder where these individuals get their inside information. Just a suggestion but we all might want to check out Mr. Peltz and his company.