Nelson Peltz’s Trian Fund Management Group isn’t the only “activist investor group” wanting seats on the Walt Disney Company’s Board. Now, investment group ValueAct Captial has also acquired a large amount of Disney stock and seems to want a seat at the table.
The difference here is that ValueAct is reportedly talking to Disney leadership directly about being brought in. It helps that they have investments in 21st Century Fox which Disney owns.
It seems that ValueAct began buying up stock during the WGA writers’ and the actors’ SAG-AFTRA strikes.
According to CNBC, Disney might be inclined to entertain their request for a Board seat as they have previously boosted stocks for other companies. ValueAct also has experience with cost-cutting and revenue growth.
“Now, these streaming wars are in the process of resolving and companies are focused more on profitability than acquiring customers at any cost. This means cutting costs and creating growing and sustainable revenue.
ValueAct has experience in both of these areas. At Salesforce, where ValueAct CIO Mason Morfit is on the board, margins have gone from 18% to 32% while the stock has gone from $130 to $220 in 10 months. Disney has already announced an aggressive cost cutting plan, but it is the revenue opportunity that is more interesting here.”
Since ValueAct wants to work with the Walt Disney Company, they are likely hoping they can block Nelson Peltz’s attempt at Board Seats.
It isn’t known how much stock ValueAct has acquired, but they claim they can get Disney shares up to $120-$190 a share. Trian Group currently has 32.9 million shares of the Walt Disney Company, which is worth about $2.7 billion. The difference is that ValueAct is known for working collaboratively with companies.
Just the announcement about ValueAct wanting a Walt Disney Company Board seat seemingly drove the stocks up to over $94.
At this point Disney needs to do something. Their stocks have fallen 40% in two years, and investors are not happy. As more investment groups come at Disney it seems to be an inevitable outcome that at least one will gain a Board seat.
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