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Blackwells Capital nominates 3 for Disney board as proxy war escalates
The Industry Jan 03, 2024
Bob Iger at the Disney California Adventure park in 2010. | Photo courtesy of Josh Hallett/Flickr (CC BY-SA 2.0)
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Adding fuel to a simmering proxy war over control of the Burbank-based Walt Disney Co., the Blackwells Capital investment firm Wednesday nominated three people for positions on the Disney Board of Directors in a show of support for company CEO Bob Iger.
The move is a counter-offensive to last month’s announcement by activist investor Nelson Peltz’s Trian Management Fund that it was nominating two people — including Peltz — for spots on the board. Peltz has been highly critical of Iger’s leadership and the direction of the entertainment giant.
All of the nominations for the board will be presented to Disney shareholders during the company’s annual meeting this spring.
In a statement announcing its board nominees, Blackwells condemned the proxy battle being waged by Peltz and Trian as “a contrived campaign that is disconnected from the needs of Disney stakeholders.” The firm argued that neither Peltz nor Trian’s other nominee — former Disney CFO James Rasulo — has “the skillsets Trian claims the board lacks.”
“Rather, we believe Mr. Peltz’s latest effort is driven by animus against Mr. Iger, and an ego-driven urge to claim credit for a transformation already underway,” according to Blackwells.
Blackwells’ nominees for the board are former Warner Bros. and NBC Universal executive Jessica Schell, real estate executive and Tribeca Film Festival co-founder Craig Hatkoff, and venture capitalist and TaskRabbit co-founder Leah Solivan.
Blackwells also proposed that any current Disney board members who might be displaced by one of Blackwells’ nominees be immediately reinstated through an expansion of the board.
“Blackwells’ highly qualified candidates have the necessary backgrounds and expertise to support Mr. Iger’s efforts constructively, and complement the board,” according to a Blackwells statement. “The Trian nominees, and the reductive nature of its campaign do not provide shareholders those benefits.”
Disney issued a statement Wednesday saying only that it has “an experienced, diverse, and highly qualified board that is focused on the long-term performance of the company, strategic growth initiatives including the ongoing transformation of its businesses, the succession planning process, and increasing shareholder value.”
Disney officials said the company’s Governance and Nominating Committee will review the proposed Blackwells nominees and “provide a recommendation to the board as part of its governance process.”
Trian Fund Management announced last month that it was nominating Peltz and Rasulo for seats on the Disney board. Peltz had fought for a spot on the board earlier last year, but he dropped the effort in February when Iger announced a massive restructuring plan that included 7,000 layoffs and $5.5 billion in cost cuts.
In late November, however, Trian announced it was renewing the proxy battle, expressing dissatisfaction with the company’s direction. The company announced then that it planned to “take our case for change directly to shareholders.”
In a statement last month, Peltz said, “As Disney’s largest active shareholder, we can no longer sit idly by as the incumbent directors and their hand-picked replacements stand in the way of necessary change, and peers and competitors continue to outperform.”
“In our view, Disney’s Board has failed to fulfill its essential responsibilities — overseeing the development of an effective strategy, planning for orderly succession, aligning executive pay with performance, and ensuring accountability for operational execution,” Peltz said. “Shareholder-led board refreshment with focused and aligned directors who are accountable to the owners of the company is long overdue.”
Disney officials have said there is an ulterior motive behind the Trian proxy fight, noting Peltz’s ties with former Marvel Entertainment chairman Isaac Perlmutter, who was fired by Disney in March.
“Mr. Peltz, in partnership with Isaac Perlmutter, a former Disney executive, intends to take its case to shareholders,” according to Disney’s statement in November. “Mr. Perlmutter owns 78% of the shares that Mr. Peltz claims beneficial ownership of, or more than 25 million of the 33 million shares. This dynamic is relevant to assessing Mr. Peltz and any other nominees he may put forth as directors, as Mr. Perlmutter was terminated from his employment by Disney earlier this year and has voiced his longstanding personal agenda against Disney’s CEO, Robert A. Iger, which may be different than that of all other shareholders.”
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