“Peltz lacks skills and experience”, Disney claims

Tuesday, Walt Disney Co (DIS.N) defended its choice not to give activist investor Nelson Peltz a board seat, claiming that Peltz “lacked the skills and experience” necessary to support the media and entertainment behemoth.

In a letter to shareholders, the Mickey Mouse Company highlighted the company’s achievements under Chief Executive Bob Iger, who just came out of retirement to oversee the business for a second time. Disney claimed, “Peltz does not understand Disney’s businesses and lacks the skills and experience to assist the board in delivering shareholder value in a rapidly shifting media ecosystem”.

To save the corporation from what he called a “crisis” of overspending on the streaming business, the acquisition of 21st Century Fox, and inadequate succession planning, the billionaire formally began his candidature for a board seat last week.

The chairman of Marvel Entertainment, Isaac “Ike” Perlmutter, served as Peltz’s internal spokesman and made half a dozen requests for the activist investor to join Disney’s board of directors.

Since July 2022, Perlmutter has been pursuing the matter on Peltz’s behalf by corresponding with former CEO Bob Chapek, director Safra Catz, and other top personnel.

One of the most well-liked leaders in Hollywood is now competing against the activist investor famed for his efforts at consumer companies in Peltz’s approach, which is considered a significant challenge to Iger. The multibillionaire investor suggested to CNBC last week that Disney should either abandon the streaming industry or purchase the remaining shares of Hulu that it does not currently hold.

Disney will purchase Comcast Corp

As early as January 2024, Disney will purchase Comcast Corp.’s (CMCSA.O) one-third stake in the Hulu streaming service. He then stated that Disney needed to increase capital investment at its parks division because ticket prices had likely been raised “too hard” there.

Disney stated on Tuesday that it was already implementing wider cost-cutting initiatives and aiming to increase profitability at the Disney+ streaming service, which Iger helped establish in 2019. The business defended its purchases for Pixar, Marvel, and Lucasfilm while CEO Iger was absent but later returned. They were described as transformative and as raising the value of the business.

According to the provisional proxy filed on Tuesday with the U.S. Securities and Exchange Commission, Disney had begun communication with Peltz as early as July 11, 2022. The activist expressed his support for the then-CEO Chapek and offered himself as someone who could be helpful if he joined the board.