It’s becoming a war of words over
Disney (ticker: DIS) and activist hedge fund Trian Partners traded fight letters on Thursday over Trian’s push to get its co-founder Nelson Peltz on the media and entertainment conglomerate’s board.
In the past week, Trian declared that Disney director Michael Froman, a
(MA) executive, shouldn’t be on the board. Disney fired back, arguing that Froman “is far better qualified” than Peltz “to help drive value for shareholders.”
Froman’s previous background as a U.S. Trade Representative gives him critical experience in managing a global company, whereas Peltz has yet to demonstrate that he understands Disney’s business, Disney shot back.
Peltz, who has served on 11 corporate boards, including
Procter & Gamble
(WEN), insists he has the skills to help Disney become the leader in streaming, not just another player. Peltz also wants to push Disney to develop better succession planning in light of CEO Bob Iger returning to the top spot less than three years after handing over the reins to Bob Chapek. And Trian wants Disney to reinstate its dividend by 2025. The company suspended the payout in 2020.
It should be an opportune time for Peltz to play a role at Disney; the share price was cut nearly in half in 2022, reducing market value by $120 billion. Trian’s Disney stake is, however, less than 1% of the shares outstanding, typically not enough to win a board seat. But shareholders can’t be thrilled over Disney’s declining fortunes, despite a 29% run-up in the stock so far this year.
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