Walt Disney is exploring a new approach to boost its share price while the ongoing feud with Nelson Peltz, the CEO of Trian, continues. On Wednesday, Disney announced that it has entered into an information-sharing agreement with ValueAct Capital Management, yet another activist investor, with the aim of seeking consultation on strategy. As part of the deal, ValueAct will lend its support to Disney’s board nominees during the entertainment company’s 2024 annual meeting.
The strategic move comes as Disney CEO Bob Iger finds himself embroiled in a clash with Peltz, who recently nominated himself and another member of his firm to join Disney’s board. Peltz has persistently engaged in a proxy battle against Disney, asserting that the company has been underperforming for an extended period. He argues that one underlying reason for this is the close affiliation between the board and Iger.
Disney has been grappling with the challenge of bolstering its profitability after making substantial investments in its streaming platform, Disney+. In addition, the company is striving to revive its theme park business, which has been significantly impacted by Covid-19 lockdowns. Critics argue that given Disney’s extensive portfolio of intellectual property and its proven track record of producing hits like Frozen and the Lion King, the company should be achieving better results.
During premarket trading, Disney shares remained relatively stable at $90.77 per share. While they have experienced a 14% increase over the past three months, they are still below their value from a year ago and considerably lower than their earlier peak of around $190 in early 2021.
Meanwhile, Comcast, a competing media corporation, saw a marginal rise of 0.2% in the premarket session, while Warner Bros. Discovery faced a decline of 1.1%.
Highlighting its expertise in assisting companies through significant transitional periods, Disney stated that ValueAct has provided support to various organizations, including Spotify, New York Times, Microsoft, and Salesforce.