Disney names a new chair in a showdown with Peltz, activist investor

As it tries to ward off Nelson Peltz, the Walt Disney Company (NYSE DIS) is looking to appoint Mark Parker, ex-Nike executive chair and current director to its board.

Trian Fund Management confirmed that Peltz would be taking up a position on the company’s Board. This asset management firm, Trian Fund Management, described Disney as “in crisis” due to its recent “disappointing” performance.

Trian stated it would file a preliminary proxy statement on Thursday in support of Peltz’s election as a board member.

Disney moved to block his appointment, however, commenting that “The board does NOT endorse the nominee of Trian Group and recommends shareholders not vote for its nominee and instead vote in favor of all nominees.”

After Disney’s annual meeting, which has yet to be announced, Susan Arnold will be replaced by Parker as the non-executive chair. The board is now down from 12 to 11.

Trian suggested that Peltz would address a number of problems at Disney. These included “a lack in overall cost discipline” as well as “minimal shareholder engagement.” Trian also pointed out that the company owned a US$900mln share.

Disney’s share price fell by nearly 40% last year amid tough times for its streaming service after COVID.

After Trian had acquired a 1.5% share in Unilever, Peltz was elected to Unilever’s Board of Directors in May 2013.

He said he wanted to help the company avoid a sell-off or a split-up. Investors began pressing the company for change after its share price fell to 3,328p in March, a five year low.

Unilever’s share price has since risen to 4,194p.

Streaming services saw a boom in the pandemic because of lockdowns that kept people at home. The industry has seen five years worth of growth between 2020-2021 according to PwC.

PwC predicted that the sector’s growth would slow starting in 2022. However, it should still be “strong”.

After-hours trading saw Disney’s share price rise, jumping from US$96.3 at yesterday’s close to US$97.9 just four hours later.