The stock proxy battle over the Disney board continues, with activist investor Nelson Peltz sending an open letter to shareholders asking them to kick out one board member and install him instead. And the Financial Times has a juicy report on Marvel head Ike Perlmutter’s involvement in the scheme.
Earlier this week, Peltz’s letter via his investment firm Trian laid out his case, suggesting the board replace Mastercard’s Michael Froman, one of Disney’s longest serving board members, with either Peltz or his son, Matthew.
“The current Disney directors wake up with challenging day jobs: building cars, selling clothing, processing credit card transactions, sequencing genes,” the letter reads. “All important things. But these accomplished directors are busy and we believe they cannot possibly focus sufficiently on Disney to ensure that 2023 and 2024 are nothing like 2022. If they could, 2022 would not have been like 2022.”
Disney’s board, which has already had several scathing responses to Peltz’s overtures, wasted no time clapping back:
“Inexplicably, Trian seeks to replace Michael Froman, a highly valued member of the Board with deep background in global trade and international business, who the Board believes is far better qualified than either Mr. Peltz or his son to help drive value for shareholders. Neither Mr. Peltz nor his son offer skills or experience additive to the Disney Board that replace the decades-long experience of Mr. Froman.”
Peltz is an 80-something billionaire neighbor of Perlmutter’s down in Florida, where they hang out and do things that 80-something billionaires do, like plan a takeover of the world’s most successful media company. Perlmutter has long standing beef with current Disney head Bob Iger, and is behind the Peltz campaign to join the board, FT reports. The story also examines the long-standing rumor of just how much stock Ike owns:
Perlmutter, the main backer of Peltz’s push to gain a seat on the Disney board, became the company’s second-largest individual shareholder in 2009 when he sold Marvel to Disney in a cash and stock deal worth $4.2bn. At the time only Steve Jobs held more shares, which he acquired after selling Pixar to Disney. It is unclear how much stock the reclusive Perlmutter, who technically reports to chief executive Bob Iger, still holds. Assuming Perlmutter has not added or sold Disney shares since the Marvel deal closed, his stake would be worth $2.4bn, around 1 per cent of the company, according to FT calculations. Only investors with 5 per cent stakes or more have to disclose their holdings. The size of Perlmutter’s stake matters because a large holding could tip the scale in favour of Peltz’s Trian Partners if the proxy battle is as close as some of the firm’s past fights.
Just who joins the board will come down to a vote among shareholders, which is why the campaigning has been so fierce. It seems that Ike himself doesn’t own enough stock to force the matter, but previous votes have been close. Nonetheless experts quoted by FT say that Iger has so much goodwill with institutional investors that the plot is unlikely to succeed.
But Ike Perlmutter never wants to know the odds! The FT piece has lots of good stuff on Perlmutter’s life story, and a fun detail: Iger hated talking to Ike so much he often delegated it to then second in command, now FORMER Disney head Bob Chapek. As previous SEC filings reveal, Chapek would later seek Perlmutter’s advice during his own embattled term as head of Disney.
While the Disney board has been highly critical of Peltz’s qualifications, they haven’t brought up his personal showbiz connections: his daughter Nicola Peltz is a rising acting star who had a recurring role in the Transformers movies, and Bates Motel, among many other things. Last year she wed prominent nepo baby/model Brooklyn Beckham, son of David and Victoria “Posh Spice” Beckham in a star studded affair whose guests included Gordon Ramsay, Serena Williams, Eva Longoria, Spice Girls Melanie Brown and Melanie Chisholm, Gigi Hadid, Gisele Bundchen, Phil Neville, and Dave Gardner.
It was indeed a posh affair, however it has led to another battle for Peltz: a lawsuit against two wedding planners who were hired six weeks before the big day (after the previous wedding planner was fired); the new duo quit just nine days before the event, citing difficulties with the RSVP list.
The filings contain all kind of petty grievances and text messages from Nicola Peltz, over whether race car driver Lewis Hamilton had RSVP’d or not. Such problems to have! Nelson Peltz seeks to get his $159,000 deposit back and $30,000 in damages.
The money is pocket change to a billionaire, but clearly Peltz is a guy who carries grudges and counts his change, traits he shares with Perlmutter. But will it fly with Disney shareholders?
The proxy battle continues with a big milestone coming up on the 8th when Disney will announce release its latest earnings report.