Disney Under the Gun as ex-Marvel Chief Hands Activist Control Over Millions of Shares

Activist investor Nelson Peltz’s renewed bid for seats on The Walt Disney Company’s board of directors is being bolstered by ally Ike Perlmutter’s sizable stake in the entertainment giant, The Wall Street Journal reported.

Early this year, Peltz, who was not so hot on chief executive Bob Iger’s return, started a “proxy contest” when he put himself forward for a seat on the board. His investment firm, Trian Fund Management, later withdrew its nomination of Peltz to the board after the company announced that it would be making organizational changes to increase profitability. 

Perlmutter, chairman of Marvel Entertainment and owner of about $2 billion worth of Disney shares, was fired following his support of Peltz’s initial bid; however, Iger said Perlmutter’s termination was not related to his advocacy for Peltz, Bloomberg reported.

Now, Perlmutter is bolstering Peltz’s chances at the coveted seat in a different way: Financially. Sources familiar with the matter told the Journal that Perlmutter has given Trian control over his stake in Disney, which totals approximately 33 million shares. This includes stock that gives Trian voting power. Perlmutter’s shares make up a greater part of Trian’s shares of Disney, according to the outlet. 

This has more than quadrupled Trian’s holdings in Disney compared with his first attempt at a board seat, the Journal reported, giving him a leg up in negotiating for the spot and others. 

Perlmutter told the Journal he will call on Disney’s board to “immediately welcome one or more Trian board candidates,” with the aim of increasing the valuation of Disney shares, which have taken a hit this year.

Earlier this month, the Journal reported that Trian believes Disney’s shares are undervalued and that the company is in need of a board that is more aligned with shareholders. Disney’s shares are now valued at $79.33, down significantly from highs of around $110 early this year.

Perlmutter has long been focused on returns. He told the Journal earlier this year that he had “no doubt” that his termination was due to “fundamental differences in business” between himself and Disney leadership.

“While I was a Disney employee, I was not comfortable publicly stating my views on the company and its performance,” Perlmutter told the Journal. “As someone with a large economic interest in Disney’s success, I can no longer watch the business underachieve its great potential.”

Iger’s second life as Disney CEO began in July after Bob Chapek was fired from the role after two years. Iger announced in July that he will remain as CEO until 2026. But it has not been without drama, as the Hollywood strikes and Charter Communications debacle brought unwelcome limelight to his leadership.

Disney acquired Marvel in 2009 for approximately $4 billion, and had worked to reduce spending on Marvel superhero films to bolster profits, according to the Journal.