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Monday, May 20, 2024

Peltz Visits Disney World, Says Needs “More Capital Invested NOW” Ahead of Epic Universe

Pain in the side of Disney CEO Bob Iger is Mr. Nelson Peltz of Trian Fund Management. Peltz’s firm beneficially owns $3 billion of common stock in The Walt Disney Company. The firm is gearing up for a proxy fight against current Disney leadership. On Thursday, Trian filed a preliminary proxy statement and reopened their RestoreTheMagic.com website, which Mickey Views covered in yesterday’s article.

To spread news of the official relaunch of the “Restore the Magic” campaign, Mr. Peltz appeared on CNBC Network’s Squawk on the Street for a revealing interview.

In his opening remarks, Peltz emphasized he and his beneficiaries love Disney, but are saddened the board does not welcome their input. “Our goal is just to work with them, to help them, and to help them make the company better,” the Trian CEO said. Peltz’s partners in this proxy fight include former Marvel Chairman Isaac Perlmutter and former Disney CFO Jay Rasulo.

Former Marvel Chairman Ike Perlmutter (left), Former Disney CFO Jay Rasulo (right).

Next, Peltz revealed that he and 6 other Trian partners visited Walt Disney World last week. Peltz highlighted the fact that unlike Iger and the board, he visited Disney World as a paying guest without VIP tour guides and without skipping lines.

Nelson Peltz visited Walt Disney World in Orlando, Florida on January 10th and 11th as a regular paying guest. (©Trian)

Giving his trip report to millions watching, Peltz said, “everybody was nice.” “[The] Magic Kingdom and the Hollywood Studios [were] terrific.”

Three year performance on Disney’s stock. Captured January 19th, 2024. (©TradingView)

“The people were wonderful, all the employees were smiling and that’s probably in large part because they didn’t own any Disney stock.” Here, Peltz is referring to the sorry state of The Walt Disney Company’s stock. $DIS has continued to falter despite a booming market, even amongst Disney’s self-selected entertainment peers.

“That’s the problem here, Jim. This company is just not being run properly. The board oversight is awful, it really is.”

Disney’s existing board plus their two nominees to join. (©CNBC Television, ©Disney)

Peltz then turns his attention back to Walt Disney World saying, “the park, as I said, certain rides were great but you can see it’s getting a bit long in the tooth. They need more capital invested.

Then, Disney’s largest active individual shareholder looks to Epic Universe. “They need more capital invested now because the competition is getting keener. You’ve got Comcast opening 500 acres right down the road in 2 years with a brand new park. They’re also opening parks in [Las Vegas] and Texas.”

Correctly identifying where the true value in Disney resides today, Peltz referred to the Disney Parks. “This is where all the value today in the stock price resides.”

CNBC’s David Faber remarked that this proxy war feels “like it’s déjà vu.” This is a reference to Peltz’s cancelled proxy fight this time last year.

Punching back, Peltz goes after Iger and the current board’s performance. “This board, from Bob to every independent director, has underperformed the S&P on every measure: one year, three years, five years, ten years. How much more do we have to go? How long do we have to continue to suffer with this ‘great’ board?”

Peltz highlights poor performance of Disney stock under current board compared to S&P and media peers. (©Trian)

On the question of lack of ‘media experience,’ which Peltz is attacked for by Disney, Peltz had an interesting comeback. “By the way, they said I have no media experience. I don’t claim to have any. But I would tell you I don’t think they have much media experience. They broke a record this year. [Did] you know that the last five movies in a row were losers? Now if that comes with ‘media experience,’ I want a guy who doesn’t have ‘media experience.’

In closing, Peltz reassured shareholders this time the proxy war is the real deal. “I made a run at them last year. They promised they were gonna improve things. I took them at their word. Things got worse. The stock went down. Results got worse. Okay? So no more. I can’t continue to give them more opportunities.”

Brayden produces quality Disney news commentary videos at Mickey Views. He is also working on feature-quality documentary films at "Address Unknown."


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