Activist investor Ancora calls for Disney (DIS) to add Trian Fund Management's Nelson Peltz to the company's board. Yahoo Finance Entertainment Reporter Alexandra Canal covers the latest developments in Peltz's proxy battle against the media company, while breaking down the provisions in SAG-AFTRA's ratified contracts with Hollywood studios.
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DIANE KING HALL: All right, Disney's proxy battle is heating up with activist investor Ancora calling for the media giant to add Nelson Peltz to its board. This comes after Peltz and his firm Trian launched their latest proxy fight against Disney last week. We wanna bring in Yahoo Finance's Ali Canal for the latest in this battle. Ali.
ALEXANDRA CANAL: Yeah, so more pressure for CEO Bob Iger, like you said, this time from Ancora. Now, Ancora is a wealth management firm and has $8.7 billion in assets under its control. But it really wants Nelson Peltz to be on this board.
They wrote a letter to shareholders saying in part, quote, "We believe Disney is saying the right things about restructuring and transforming the enterprise. Nonetheless, the addition of a shareholder representative or investor designated directors to the board can help ensure that these efforts are carried out in the most effective way."
Now, the firm said that all the issues that Disney has or the bulk of the issues that Disney has largely stems from the current board. Now, that includes things like that dismal box office performance, those escalating streaming losses.
Ancora also accused the board of politicizing the brand, referencing that ongoing political battle with Florida Governor Ron DeSantis. And this is all coming after Trian launched that proxy fight last week. And Trian told Yahoo Finance that they are seeking multiple board seats here, including one for Nelson Peltz.
CEO Bob Iger, he's talked about this at the "New York Times," DealBook Summit. He said that this is something that they're going to have to continue to contend with but that he's not going to be distracted by all of this right now because there are much more pressing issues at the company. So just a lot of noise, I think, around this company, especially heading into the new year.
BRAD SMITH: Yeah, we talk about reboots all the time within the entertainment sector. This is a reboot of the activist era and all in the same year for Disney as well here. You know, separately here, though, we've been tracking and we know you have as well. There's been some movement on the SAG-AFTRA contract voting as well. What do we know there?
ALEXANDRA CANAL: Hollywood is back in business, baby. There's union members officially voting to ratify this new multi-year contract overwhelmingly in a vote by 78.33% to 21.6% with a voter turnout of around 40%.
Now, SAG-AFTRA, they have been working on these protections. This strike, which lasted 118 days, officially ended in November. The contract that they came up with is valued at over $1 billion. It includes, quote, "above-pattern" minimum compensation increases, also unprecedented provisions when it comes to protections surrounding the use of artificial intelligence.
So the union has really described this as a landmark deal moving forward. You know, that being said though, there's been a lot of pain in Hollywood leading up to this. We saw the delays of several big blockbuster films.
45,000 jobs were lost in the entertainment sector. So despite us reaching this point-- the writers' strike ended in October-- there is still going to be a little bit of a lingering effect, especially when you think about the cost to the economy overall.
DIANE KING HALL: Right. And one of the sticking points had been over AI. And it's so funny if you're talking about what's happened with the contract. I keep getting robocalls from them about the contract. And they made the same points you did about this. You know, it's $1 billion plan funding with regard to wages and benefits. Of course, it's AI transcribing the message that I got.
ALEXANDRA CANAL: Yeah. And you know, AI was a big sticking point for the writers as well. And that was why we saw these negotiations last a long time. But you hear from the studios now. And Ted Sarandos, he was just at the UBS conference the other day. And he started off by saying, first and foremost, I wanna talk about the strike and how we are so happy that the strike is officially over.
BRAD SMITH: Yeah, it was the elephant in the room for quite some time here. So finally getting ratified, it looks like. Ali, thanks so much for--
ALEXANDRA CANAL: Thank you.
BRAD SMITH: --joining us to break this down. We appreciate it.