Activist hedge funds ValueAct Capital and Blackwells Capital have thrown their support behind Walt Disney Co as the entertainment giant faces a boardroom clash with activist investor Trian Fund Management, according to a report by CNBC.
This unexpected development in the struggle for control over Disney's board highlights the intense competition surrounding the company's ongoing efforts to revitalize its operations under the leadership of CEO Bob Iger.
Disney's Collaborative Agreement with ValueAct
Bob Iger, who previously helmed Disney from 2005 to 2020, returned to the position in November 2022 amidst challenges such as a $1.5 billion quarterly loss in its streaming sector and underperformance in various movie franchises, leading to a decline in the company's stock value.
Disney announced a collaborative agreement with ValueAct, with the hedge fund providing strategic advice and backing Disney's director nominees during the upcoming annual shareholder meeting.
Simultaneously, Blackwells Capital has disclosed its nomination of three directors for Disney's board. Notably, unlike Trian Fund Management, these nominees align with Disney's current strategic direction, confirming earlier reports from Reuters.
Iger Expresses Optimism
Disney CEO Bob Iger expressed his optimism about the collaboration with ValueAct, emphasizing the hedge fund's history of cooperative engagement with the companies in which it invests. Mason Morfit, co-CEO of ValueAct, has been notably constructive in their discussions over the past year, according to Iger.
Acknowledging Blackwells' nominations, Disney stated that its governance and nominating committee would review the candidates and provide recommendations.
The company defended the composition of its existing board, highlighting its experience, diversity, and high qualifications. The board said it is committed to long-term performance, strategic growth initiatives, succession planning, and enhancing shareholder value.
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