Walt Disney Co's (DIS.N) board extended Chairman and Chief Executive Bob Iger's contract through June 2018, keeping him at the helm of the media and theme park company two years longer than he previously planned.
Disney announced the contract extension on Thursday but did not say who would succeed Iger, who has led the company to record profits. He plans to name a chief operating officer next year, a person with knowledge of Iger's thinking said, setting up a likely successor.
Tom Staggs, head of the company's theme parks division, and Chief Financial Officer Jay Rasulo are considered leading candidates to replace Iger, Wall Street analysts say.
The media company has thrived since Iger became CEO in 2005. He oversaw the acquisitions of movie studios Pixar, Marvel and LucasFilm, which will release a new "Star Wars" movie in December 2015. A theme park in Shanghai also is slated to open next year.
Disney's board earlier this year asked Iger to extend his contract for two years. Iger said he accepted so he could continue working on the major initiatives he put in place.
"I looked ahead and got very excited about a lot of what we have in store, in particular some of the new things like Shanghai Disneyland and Star Wars," Iger said in an interview. "I wanted to stick around to be part of that, not just the opening but seeing those big projects through."
Disney's market capitalization has climbed to $150 billion from $48.4 billion during Iger's tenure as CEO, Orin Smith, the company's lead independent director, said in a statement. Total shareholder return has been 311 percent, compared with 92 percent for the S&P 500during that time.
"Bob Iger is the architect of Disney's current success, with a proven history of delivering record financial results for the company quarter after quarter and year after year," Smith said.
The contract extension is the second for Iger, who is 63. He had previously announced plans to step down as CEO in April 2015 but later agreed to stay in that role, along with the job of chairman, through June 2016. The terms of his compensation will remain the same, Disney said.
Keeping Iger in place for a longer period gives Disney more time to groom the person who will succeed him, Wunderlich Securities analyst Matthew Harrigan said.
"Disney is really locked down on a pretty good path," he said.
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