Disney Secures Support From ValueAct Capital in Proxy Battle With Nelson Peltz

The Walt Disney Co. said activist investor ValueAct Capital Management will support its nominees for the company's board of directors as another activist looks to cause a shakeup at the Mouse House.

ValueAct has signed a confidentiality agreement that allows Disney to disclose information to the firm and consult it on "strategic matters," the companies said Wednesday. The investment firm has a history of investing in companies and working behind the scenes to push changes at companies ranging from The New York Times to Adobe and Nintendo.

The San Francisco-based firm has been building its stake in Disney and sees room for Disney's stock price to roughly double, Reuters reported in November, citing people familiar with ValueAct's thinking.

“ValueAct Capital has a track record of collaboration and cooperation with the companies it invests in, and its Co-CEO Mason Morfit has been very constructive in the conversations we’ve had over the past year," Disney CEO Bob Iger said.

Disney is currently engaged in a proxy battle with activist investor Nelson Peltz and his firm Trian Fund Management, which owns some $3 billion of common stock in the company. The firm has nominated both Peltz, who has served on the board of several consumer goods companies, and former Disney CFO Jay Rasulo to Disney's board.

“As Disney’s largest active shareholder, we can no longer sit idly by as the incumbent directors and their hand-picked replacements stand in the way of necessary change, and peers and competitors continue to outperform,” Peltz said last month.

A third activist, hedge fund Blackwells Capital, has nominated three directors to Disney's board as part of its opposition to Trian. Blackwells, which owns just $5 million of Disney stock, is supportive of Iger and has called on Trian to drop its board challenge.

Blackwells has also formally requested that Disney's board investigate Trian's relationship with a fourth activist investor, Ancora, which has supported Peltz's nomination.