Peltz, citing changes at Disney, ends push for seat on board

By MICHELLE CHAPMAN
AP Business Writer

Activist investor Nelson Peltz has called off a proxy fight with Disney one day after newly returned CEO Bob Iger announced a major restructuring of the company that includes thousands of job cuts.

Peltz phoned into CNBC on Thursday to say that his firm, Trian Fund Management, got everything it wanted with the changes imposed by Iger.

“We will be watching, we will be rooting, and the proxy fight is over,” Peltz said.

Peltz last month announced that he would seek a seat on the board of the entertainment company, citing a failed succession after Iger departed about two years ago and named Bob Chapek as his replacement. Peltz cited “over-the-top” compensation for executives and other issues.

Disney on Wednesday said that it would cut about 7,000 jobs as part of an ambitious companywide cost-savings plan and “strategic reorganization.”

The job cuts amount to about 3% of the entertainment giant’s global workforce and were unveiled after Disney reported quarterly results that topped Wall Street’s forecasts.

That was apparently good enough for Peltz, who launched a fight for a board seat even after Chapek was ousted and Iger returned.

The company, which owns Star Wars, Marvel and Pixar, said this week that it will focus more on its core brands and franchises, Iger said.

The executive also announced changes to how executives will operate Disney’s various divisions. Specifically, creative executives will now be responsible for determining what movies, TV series or other content to produce, as well as the marketing and distribution.

Shares of Disney, based in Burbank, California, rose 2% Thursday.

Iger had handpicked Chapek as his successor, whose two-year tenure was marked by clashes, missteps and a weakening financial performance. Iger’s return to Disney and ousting of Chapek came just a couple of weeks after Disney’s quarterly financial performance fell well short of Wall Street expectations on both profit and revenue, a rarity.

While Disney’s theme parks business has been performing well, many visitors over the past two years have been highly critical of increased prices and other moves that the company made, including the end of the Magical Express bus service from the airport in Orlando, Florida to Walt Disney World resorts, the implementation of the Genie planning and ride reservation system and its theme park reservation system.