Hedge fund billionaire Nelson Peltz has divested his entire stake in Disney following an unsuccessful attempt to secure a position on the company’s board of directors.
Nelson Peltz, the father-in-law of Brooklyn Beckham, made significant headlines by selling his entire Disney stock. This move came after Peltz’s effort to join Disney’s board was decisively rejected at an April shareholder meeting. Reports indicate that he sold his shares at nearly $120 each, netting approximately $1 billion from the sale.
The conflict began when Peltz, funded by his hedge fund Trian Partners, pushed for a board seat, highlighting concerns over Disney’s leadership succession planning. Peltz was critical of the board’s handling of former CEO Bob Chapek’s appointment, who took over from Bob Iger in 2020. Under Chapek, Disney experienced a series of missteps, leading to Iger’s return in November 2022. Despite Peltz’s efforts, his bid was defeated by other shareholders, securing only a third of the votes needed.
Peltz had aimed to replace two directors, Maria Elena Lagomasino and Michael Froman, citing Disney’s persistent underperformance. However, the move failed as Lagomasino retained her position with a two-to-one margin in votes. Peltz’s critique was that the board did not adequately vet Chapek, attributing Disney’s struggles to this oversight.
Following his defeat on the boardroom front, Peltz warned that he would persist with his critique if the board’s performance didn’t improve. He stated, “I hope this is not a redo of last year where we pulled out, gave management a chance and the stock went down. Whether we stay [invested in Disney] or not, we don’t make those kinds of announcements.”
The saga underscores the ongoing challenges within Disney’s leadership. Bob Iger’s extensive tenure has seen the company through various highs and lows, including the pandemic and the rise of online streaming. His temporary replacement by Chapek proved tumultuous, leading to Iger’s unexpected return. As Iger plans to step down by 2026, potential successors have been shortlisted, comprising Dana Walden, Alan Bergman, Jimmy Pitaro, and Josh D’Amaro, aiming to avoid repeating past mistakes.
Nelson Peltz’s divestment from Disney highlights the complexities in corporate governance and investor relations within one of the world’s leading entertainment companies. With ongoing leadership transitions at Disney, the company’s future direction remains a focal point for both shareholders and industry observers.
