🎧 Listen: In today's episode of The Journal podcast, RWhelanWSJ details the proxy battle that rattled Disney
This transcript was prepared by a transcription service. This version may not be in its final form and may be updated.
Robbie Whelan: What it means is he buys up big stakes in companies and then he advocates for change, either by joining the board himself or by suggesting people to be added to a company's board of directors who he thinks will make changes that will improve the company's business.Robbie Whelan: It's very uncomfortable for Disney.
Robbie Whelan: Activist investors, their business model is they buy a bunch of stock and then once they succeed in making these changes to a company, presumably the stock's going to go through the roof, and they're going to sell that position in stock and make a huge profit on the difference between what they bought it for and what they sold it for. That's generally the activist investor business model.
Robbie Whelan: The stock price falls by about 13% in a day. It's one of the biggest declines in Disney's share price ever. Ryan Knutson: As an activist investor, the main goal is to bring up the company's stock price. And Peltz now owned a ton of Disney's shares. Ryan Knutson: After the break, Disney strikes back. After Peltz launched his proxy battle, Disney had to respond.
Ryan Knutson: Perlmutter is one of Disney's biggest individual shareholders, and while he doesn't get along with Iger, he does get along with Peltz. Ryan Knutson: In its filing, Disney also said Peltz didn't understand the company's business and didn't have the skills or experience necessary to join the board. The company said it was already working on big strategic changes. Then last week, Disney had another earnings call, the first one since Iger returned. He announced a major reorganization of the company and said he was making changes at the executive level.
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