Nelson Peltz, founding partner and CEO of Trian Fund Management, speaks with CNBC’s Andrew Ross Sorkin on July 17, 2013 in Recent York.
Heidi Gutman | CNBC, NBCU Photo Bank, NBCUniversal via Getty Images
Are you not entertained, Nelson Peltz?
Disney shares jumped 6% in after-market trading Wednesday after the company posted earnings and flooded the zone with latest announcements meant not only to excite its employees and shareholders, but additionally to place activist investor Nelson Peltz in his place.
Peltz has launched a proxy fight against Disney, asking investors to nominate him and former Disney Chief Financial Officer Jay Rasulo to switch current board members Michael Froman and Maria Elena Lagomasino. Each Disney’s higher profits, and string of content and partnership announcements, appeared to form a direct rebuttal to Peltz’s concerns concerning the company.
“The last item we’d like straight away is to be distracted by an activist or activists which have a distinct agenda and do not understand our company,” Disney Chief Executive Bob Iger told CNBC’s Julia Boorstin in an interview Wednesday.
During his company’s first-quarter earnings conference call, he added, “we have now turned the corner and entered a latest era.”
Peltz, who first took a stake in Disney last 12 months only to desert after which renew his proxy fight threats, responded with an announcement to CNBC that he won’t be backing down this time.
“It’s deja vu all once more,” Peltz’s firm Trian Fund Management said in an announcement. “We saw this movie last 12 months, and we didn’t just like the ending.”
It was hard to maintain up with Disney’s announcements this quarter:
- ESPN finally set a launch date for its direct-to-consumer service: August or fall of 2025.
- Disney is buying a $1.5 billion stake in Epic Games, the maker of Fortnite. It’s Disney’s “biggest foray into the gaming space ever,” Iger said to Boorstin.
- Taylor Swift’s Eras Tour film is coming to Disney+.
- Disney upped its dividend by 50% versus the last dividend paid in January.
- Disney announced a sequel to “Moana” is coming to theaters in November, which is able to likely be the studio’s biggest box office hit of the 12 months.
- Disney is heading in the right direction to fulfill or exceed its $7.5 billion targeted spending cuts by the tip of fiscal 2024.
- The corporate said it expects full-year fiscal 2024 earnings will increase a minimum of 20% over 2023.
All of those announcements got here a day after Disney made more big news, revealing it’s launching a three way partnership with Warner Bros. Discovery and Fox to supply ESPN in a latest skinny bundle of linear networks that caters to sports fans later this 12 months. It can be the primary time cable cord-cutters and cord-nevers may have access to ESPN outside the standard cable bundle.
It’s only logical that the mountain of announcements got here this quarter, given activist pressure from Trian and Blackwells Capital. Iger has a vested interest in beating back critics of his performance and strategy.
Peltz has been vocal about bashing Iger’s leadership as shares have slumped previously 12 months, underperforming the S&P 500. Trian has launched an internet site, Restorethemagic.com, that claims Disney has “not performed for shareholders.”
“It saddens me that the board didn’t welcome me,” Peltz said last month. “This company is just not being run properly.”
Iger said he hasn’t spoken with Peltz recently and doesn’t intend to talk with him. In a filing last month, Disney said “in deciding to not recommend Mr. Peltz, the administrators considered quite a few aspects, including that in a two 12 months quest for a seat on the Disney Board, Mr. Peltz had not actually presented a single strategic idea for Disney.”
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