Disney Shares Extend Gains As Company Hits Back At Activist Investor

Disney shares were up 2% at mid-day Monday, extending their recent rally, as the company renewed its attacks on activist investor Nelson Peltz.

In a video posted to VoteDisney.com criticizing Peltz and his firm, Trian Fund Management, Disney said the investor’s pursuit of board seats for himself and ex-Disney CFO Jay Rasulo “seems more about vanity than a belief in Disney.” The company added that Rasulo “hasn’t been employed since leaving Disney” in 2015. The proxy fight is set to play out April 3 at the company’s annual shareholder meeting, which will be a virtual event this year.

Disney stock hit $112.76 with two hours left in the trading day. It has rebounded significantly since touching multi-year lows last fall, rising almost 25% in 2024 to date. (Trian has pointed to shareholder returns well below the broader market on a 3-year and 5-year basis and has also noted that the stock’s recent record high near $190 came in 2021 during the tenure of former CEO Bob Chapek.)

Another activist firm, Blackwells Capital, has criticized Disney’s board and has put forward three of its own nominees, but it differs from Trian on several points. For example, it has backed CEO Bob Iger, a contrast with Peltz’s frequent attacks on the executive and his leadership.

Peltz, Disney maintained in the video, has made a habit of “attacking companies to the ultimate detriment” of shareholders. Prior to his focus on Disney, Peltz was known for waging a long and ultimately successful proxy war against consumer products giant Procter & Gamble. The Disney video ominously notes two other companies Peltz has targeted, General Electric and DuPont, both of which have stumbled in the years since the investor’s engagement.

The video offers “false and misleading statements designed to divert from Disney’s poor performance over many years,” Trian said in a statement Monday.

“The Disney board is always open to good ideas from engaged shareholders,” the video said. “But a quick glance at Peltz’s white paper [released last week] will reveal a surprising number of questionable proposals that reinforce his clear lack of experience in media, not to mention a litany of factual misstatements and quite a few proposals that Disney is already implementing.”

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