Proxy advisory firm ISS backs Nelson Peltz's bid to join Disney's board

By Jon Swartz

Activist investor Nelson Peltz on Thursday received a mega-endorsement in his bid to join Walt Disney Co.'s board, as influential proxy advisory firm Institutional Shareholder Services threw its support behind him.

ISS, whose recommendations hold considerable sway over hundreds of investors, said Peltz, a major Disney (DIS) shareholder, would help the Magic Kingdom navigate to a winning strategy and find a successor to current Chief Executive Bob Iger.

"Dissident nominee Peltz, as a significant shareholder, could be additive to the succession process, providing assurance to other investors that the board is properly engaged this time around," ISS said in a report, which was viewed by Reuters. ISS also recommended that shareholders withhold votes for company board nominee Maria Elena Lagomasino.

Disney immediately batted down ISS's backing of Peltz.

"While we're heartened to see support for Michael Froman and ISS's recommendation to withhold on dissident directors Jay Rasulo and the Blackwells' nominees, we strongly believe that ISS reached the wrong conclusion in its recent report when it comes to adding Nelson Peltz to the board," Disney Chairman Mark Parker said in a statement. "In contrast to Glass Lewis, ISS fails to acknowledge the breadth of perspective and expertise Ms. Lagomasino adds to the board. The strong recent performance and results overseen by the Disney board demonstrate our focus on long-term shareholder value creation and succession planning and our commitment to good governance practices."

Disney's annual shareholders meeting is scheduled for April 3.

Peltz's Trian Fund Management is vying for two board seats - one for Peltz, the other for former Disney Chief Financial Officer Jay Rasulo. Another activist firm, Blackwells Capital, is pushing for three board seats.

The fight over control of Disney has devolved into one of the year's most bitterly contested board battles, as Iger tries to thrust the company more forcefully into the direct-to-consumers market with streaming services. Iger's contract as CEO ends in two years.

Shares of Disney were flat in Thursday trading.

-Jon Swartz

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03-21-24 1833ET

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