New York, United States

Walt Disney Co. and investor activist Nelson Peltz will face a boardroom battle after the home of Mickey Mouse denied the billionaire a seat on the board.

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Peltz, who co-founded Trian Fund Management, petitioned to join the board after criticising Disney's management in what could become a public debate over CEO Bob Iger's leadership.

He criticised Disney for failing to plan properly for its succession, overspending on 21st Century Fox and "over-the-top" compensation packages.

In a blistering statement, Peltz-owned Trian, which holds a $900 million stake in Disney, said, "Disney's recent performance reflects the hard truth that it is a company in crisis".

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Trian also noted that Disney's stock is near an 8-year low because the company lacks cost discipline.

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While Peltz listed several problems, which he says are "self-inflicted and need to be addressed," he did not give any detailed plan to overcome those difficulties.

A boardroom stand-off will pit one of corporate America's most respected activist investors for his work at consumer companies against Iger, one of the most revered and hugely popular CEOs in media.

Also read | Disney to roll back theme park prices as Iger attempts to woo visitors back

But Peltz says he does not want to replace Iger or break the company up, and instead, he was in favour of restoring the company's dividend by 2025.

Peltz is known for forcing his way into boards of large corporations such as Mondelez International and Proctor & Gamble co., including through proxy battles.

Even when the activist investor has been unsuccessful in his bid for a seat, such as in the case of Dupont, his campaigns have helped cost savings and managerial reforms.

On the other hand, the boardroom battle is a rebuke of Iger, who rose to prominence as one of the media industry's top CEOs during his first tenure as head of Disney between 2005 and 2020, but has failed to appoint a successor.

The latest also marks the second request for change in six months from an activist shareholder. Daniel Loeb of Third Point had previously pushed Disney to sell ESPN, repurchase shares, and replace its board.

(With inputs from agencies)

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