Who is Nelson Peltz? Disney gives 16-page-long reason why it doesn’t want the billionaire on its board
WASHINGTON, DC: The Walt Disney Company defended its decision to deny Nelson Peltz a board seat, saying the billionaire activist investor lack experience in big media and tech. Disney submitted a 16-page deck to the Securities and Exchange Commission (SEC) entitled ‘The Current Disney Board Is the Right Board for Shareholders’ on Tuesday, January 17, that read, “Peltz has no track record in large cap media or tech, no solutions to offer for the evolving media landscape.” It also defended CEO Bob Iger’s past acquisitions and said Peltz "does not understand Disney’s business and lacks the skills and experience to assist the board in delivering shareholder value in a rapidly shifting media ecosystem.”
In the filing with the SEC, the entertainment company wrote, "Peltz, or Isaac Perlmutter (an employee and shareholders of Disney who currently serves as Chairman of Marvel Entertainment) on Peltz’ behalf, asked for a Board seat or suggested he should be added to the Board no less than 20 times since July 2022." It further said, "Peltz wants to adapt strategies to address changing industry dynamics. Yet he lacks a basic understanding of our industry by his own admission.”
The company also laid out how the current board, which includes outgoing chairman Susan Arnold and newly elected chairman Mark Parker, as well as 10 other members, is “overseeing key changes that management is currently implementing” across four areas -- "reorganizing leadership structure to put more decision-making back in the hands of creative teams," "implementing cost reduction plan and streamlining our organizational structure to enhance productivity," "prioritizing streaming profitability (in addition to revenue and subscriber growth)," and "improving the guest experience” in the theme parks by “providing more value and flexibility.”
Who is Nelson Peltz?
Born on June 24, 1942, in Brooklyn, New York, Peltz is the father of Brooklyn Beckham's wife Nicola Peltz. He co-founded Trian Fund Management, an investment firm, in 2005 with Peter May and Edward Garden. The firm now has $8.5 billion in assets under management, states Forbes, and owns less than a five per cent stake in Disney valued at $900 million, as per New York Post.
'Help Disney restore the magic'
Disney defended board, CEO Iger, who came back as CEO in November 2022 after Bob Chapek was ousted, following Peltz's filing with SEC on January 12. It said that Disney had lost its way, "resulting in a rapid deterioration in its financial performance." The firm also said they could "help Disney restore the magic."
Why does Peltz want to join Disney board?
According to IR Magazine, Trian believed that "Disney’s annual performance reflects the hard truth that it is a company in crisis, with many challenges weighing on investor sentiment." Peltz added, "The company has lost its way, resulting in a rapid deterioration in its financial performance from a consistent dividend-paying, high free cash-flow generative business into a highly leveraged enterprise with reduced earnings power and weak free cash-flow conversion. My goal would be to work collaboratively with Bob Iger and other directors to take decisive action that will result in improved operations and financial performance, enhanced shareholder value and a robust succession planning process that will set the stage for sustainable growth over the long term."
Who are the current board members?
At present, there are a total of 12 board members, states Disney's website. They are as follows Susan E Arnold, Chairman of the Board, Mary T Barra, Safra A Catz, Mark G Parker, Amy L Chang, Francis A DeSouza, Carolyn Iverson, Michael Froman, Robert A Iger, Maria Elena Lagomasino, Calvin McDonald, Mark G Parker and Derica W Rice.