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Disney execs skirt takeover bid topic

Top Walt Disney Co. executives bypassed the one question on the lips of nearly 100 shareholders and analysts at its annual investors meeting Thursday: How will Disney respond to Comcast Corp.’s unsolicited takeover bid?
/ Source: Reuters

Top Walt Disney Co. executives bypassed the one question on the lips of nearly 100 shareholders and analysts at its annual investors meeting Thursday: How will Disney respond to Comcast Corp.’s unsolicited takeover bid?

Board members and executives instead focused on talking up the company’s financial outlook in a presentation to analysts.

Chief Financial Officer Tom Staggs pointedly avoided mentioning Comcast’s surprise $48 billion bid, eliciting chuckles from the audience when he called Wednesday a “pretty uneventful day.”

Many investors, after sitting through hours of presentations about the company’s myriad businesses, appeared to side with the company’s main message, that Disney is worth more than Comcast’s all-stock bid, valued at about $47.96 billion based on the closing price of Comcast stock on Thursday.

“There’s a reasonable probability Comcast will not make it,” said Hal Vogel of Vogel Capital Management. “Financially, they are not coming with tremendous power.”

Another Disney investor, Jack Liebau, president of Liebau Asset Management, said he believed Disney would likely survive as an independent company with Eisner at the helm post-Comcast.

To be sure, Eisner is under fire. The company’s share price has stumbled in recent years and Roy Disney, the nephew of company founder Walt Disney, has spearheaded a move to oust Eisner from the board.

Eisner, 61, has overseen substantial growth at Disney in nearly 20 years as CEO.

But Comcast’s bid for Disney puts still more pressure on Eisner. The top U.S. cable TV operator said it launched its bid after Eisner refused to enter talks.

Defending Eisner, governance
Thursday’s presentations marked the second day of Disney’s annual two-day investors conference, held at Walt Disney World in Orlando, Florida. Disney has traditionally used the annual forum as a pep rally to instill confidence among its vast array of shareholders.

“We realize our overriding goal is to manage the Walt Disney Co. in the best interests of our shareholders,” Staggs said.

George Mitchell, a former U.S. senator from Maine and the company’s presiding director, launched a fiery defense of Disney’s much-maligned governance practices during a luncheon presentation.

Institutional Shareholder Services recommended Wednesday that Disney shareholders withhold their vote to reelect Eisner to the board, to show their disapproval with Eisner and Disney’s corporate governance.

Mitchell dismissed the ISS report and said Disney’s board and Eisner had addressed many of those concerns.

“We had been listening to the concerns that have been expressed about us,” he told attendees, alluding to motions to whittle down the size of the board in addition to creating the position of an independent presiding director. “We listened and we took action.”

Mitchell also took the opportunity to defend Eisner. “The recommendation with respect to Mr. Eisner is wholly unjustified.”

Mitchell told Reuters the company was committed to keeping shareholders’ best interest in mind regardless of the outcome of Comcast’s bid.

“We’ve asked for a thorough review,” he said. “When we receive the analysis and review, we will meet, deliberate on it and make what we hope will be the appropriate response in the best interest of the company’s shareholders.”

John Bryson, Chairman and CEO of Edison International, who holds a Disney board seat, told Reuters in Houston, Texas that ”We just want to figure out the best path forward.”

Shares of Disney -- which rose nearly 15 percent on Wednesday to their highest level since July 2001 -- on Thursday closed up 1.45 percent at $28.00 on the New York Stock Exchange, where they were the second most active issue. Shares of Comcast fell nearly 3.75 percent to $30.06 on the Nasdaq, after dropping 8 percent on Wednesday.