ITV

Tag: Roy Disney

  • Disney CEO Eisner to step down in 2006

    Disney CEO Eisner to step down in 2006

    MUMBAI: Walt Disney has said that its CEO Michael Eisner will step down in September 2006, when his contract expires.
     

    In a letter to the Disney board Eisner said, “Until then I shall continue to exert every effort to help the company achieve our goals, to assist the board in selecting the new chief executive officer, and to make the transition expeditious, efficient, and smooth and easy.

    “I know that it has been a very challenging time for the board members during this period, and I am most grateful for all of the time and effort, consideration and support, and concern for the company that all of you have demonstrated.”

    However Antony Gifford, who helps manage about $2 billion of US stocks at Henderson Global Investors in London was quoted in a Bloomberg report expressing disappointment that Eisner would only leave after another two years.

    ” We believe that Disney has some attractive assets that are worth more than the share price suggests. But Eisner wasn’t the man to unlock that value.”

    Meanwhile, in an earlier interview with the Wall Street Journal, Eisner had maintained that he didn’t make the decision to step down because of pressure from Roy Disney and Gold or Comcast’s takeover bid.

    As had been reported earlier by Indiantelevision.com, Eisner had earlier said that he wanted Disney President and COO Robert Iger to succeed him. However, in his letter to the board, Eisner made no mention of Iger

    It may be recalled that in November 2003 former Disney directors Roy Disney and Stanley Gold had resigned from the board to wage a campaign against Eisner.

  • Roy Disney emphasies need for accountability at Disney

    Roy Disney emphasies need for accountability at Disney

    MUMBAI:” Without the support of its employees, how can this CEO get the company back on track?” This was just one the many cutting remarks made by Disney’s former vice chairman Roy Disney about the company’s CEO Michael Eisner.

    The dispute about the direction the media conglomerate is going in as well as the need for accountability from the board is reaching boiling point.

    A few days ago Roy Disney spoke to the company’s institutional investors and dwelt on the need for change and further transparency in the company’s functioning.

    He said, “One of the most fundamental and important duties of a board is to monitor and hold the CEO accountable for the long-term performance and strategy of a company. “

    One of the management failures he highlighted was that of the broadcast network ABC. He stated that it suffered operating income losses of around $ one billion over the last six years. The website Go.com was writen off in excess of the same figure Disney claimed. He also said that Fox Family was worth $ four billion less than that paid when purchased. He also estimated that the Disney Stores would have lost approximately $100 million over the last several years.

    “In total, these mistakes of the last five years alone have cost shareholders over $ seven billion. And yet, somehow, the shareholders are expected,to simply look past these indisputable facts.” He stressed that the board could not allow management to hide behind years of significant failures because of two good movies and an accounting change that is driving 2004 growth.

    He was expectedly severe on Eisner saying, “Because I knew Michael Eisner, I knew he would use the resources of the company to protect himself. I knew the difficulties that this board would have in challenging and confronting him. Recent reports unfortunately confirm my instincts. The board needs to ask itself the value to shareholders of the millions being spent on political lobbyists and consultants across the country.

    “These efforts and expenditures are shameful, have little to do with inspiring creativity and the board remains quietly acquiescent at best. Michael Eisner is behaving like a third world dictator of a once great country utilising political carrots and sticks to manipulate the electorate. His “cabinet” sits mute for fear of beheading.”

    He said that there were three issues facing the board at this point in time. The first was timing in terms of when the board would be able to find the courage to do what is right. The second issue is whether the board go through a thorough, professional and dispassionate process to select the next leader of Disney . The third is to measure short term goals versus the long term outlook.

    “The fourth issue is that of board transparency. Will the Board begin to fully confront the series of legitimate questions to which shareholders seek answers or will they continue to allow management to “spin” half truths and incomplete facts to the company’s owners?” Disney sdaid.

    He added that three years ago he and fellow Board member Stanley Gold started feeling that fundamental change was necessary at Disney. This was because the company’s financial performance had been declining for more than five years He claimed that optimistic projections that had been given later often failed to materialise. Roy quit the company’s board last December. He accused the board of being lame when it merely separated earlier this month the Chairman and CEO roles. “This was very nearly a non-event … a move to mollify the shareholders by interpreting the vote as “just a governance matter.”

    He said that at the board meeting on 3 March over 70 per cent of the participants voted against their leader. “These figures confirm my long held concern that the morale among the company’s 125,000 employees, many of whom touch our guests every day, sits at an all time low.”

  • Disney’s Eisner on a ego boosting trip?

    Disney’s Eisner on a ego boosting trip?

    MUMBAI: Does the Walt Disney Company or rather its chairman and CEO Michael Eisner know what he wants? Is he waiting for a bid or not, and if he is, then the obvious question is why?

    Eisner was recently quoted in a media report saying that the board was open to a “really spectacular” offer but nonetheless would not give away the company. Sounds more like ego boosting.

    Disney which is facing a looming takeover bid from Comcast Corp. and is also under fire from dissident shareholders.

    When Comcast made the unsolicited bid to Disney on 11 February, the company’s board turned down the offer as too low. According to a media report, Eisner who was interviewed by Larry King on cable channel CNN, declined to name a price for Disney. “Ah, please!” he said, adding that he would not give away sports channel ESPN and other premier brands. Eisner said that he believed he had the full support of the Disney board in the face of the Comcast bid and criticism from dissident shareholder Roy Disney.

    Comcast is also a Disney customer and is negotiating a new contract with ESPN. A media report said that ESPN had cut deals on 19 February with Comcast rivals Cox Communications Inc. and Charter Communications Inc., and Eisner said he would like to charge Comcast more just because he “felt that way.”

    On the other hand Disney dissident Roy Disney said that the Comcast offer too low for the company. Roy Disney and fellow former board member Stanley Gold said in a statement, “In the view of many, including us, the Comcast offer does not adequately reflect the true potential value of Disney’s assets.”

    Roy Disney, nephew of Walt Disney, and Gold have been campaigning for the ouster of Eisner.

  • Microsoft features in the Com-Di affair

    Microsoft features in the Com-Di affair

    MUMBAI: While a lot of speculations are being made in the media about the outcome of the Comcast-Disney merger if it does come about; here’s the latest on that front.

    Now looks like the world’s leading software company Microsoft is a possible suitor for Disney. It may turn out that in the bid that Comcast made for Disney; Microsoft may be the silent partner.

    The software company owns 7.4 per cent of Comcast and would eventually end up controlling about four per cent of the world’s largest media company if Comcast’s bid succeeds.

    A few analysts said in a media report that the stake could give Microsoft leverage over the course of the deal and afterward as it looks to push its software beyond the maturing market for personal computers and into the still-developing boom in digital entertainment.

    Since Microsoft has long sought to forge links in the telecommunications and entertainment industries in order to sell its software, it could definitely emerge as a rival bidder for Disney. With nearly $53 billion in cash, Microsoft could easily pay for a large media franchise, such as Disney, with cash or stock.

    Reports indicate that even a minority ownership in a media giant rivaling Time Warner Inc. could be enough to create stronger links between Microsoft’s software, Comcast’s distribution and Disney’s prized entertainment assets.

    On the other hand, Disney’s CEO Michael Eisner said today that Walt Disney Co. did not need a new distribution outlet for its films and television shows because of their popularity. Eisner was quoted in a media report saying, “There are great distribution companies, there are great content companies. They can be together. They don’t have to be together. We feel we’re running a pretty good company as it is.”

    In the midst of all this, Eisner is also fending off calls to resign by ex-directors of the company – Roy Disney and Stanley Gold as he campaigns for re-election to the board before the company’s annual meeting on 3 March.

    If you are wondering what a staid cable company like Comcast might want with the Mickey Mouse business. Well, lots. If the merger does come about, Comcast would be, for one, saving up on a lot of money. Disney’s films and television shows and networks add up to programming that – if owned by Comcast – wouldn’t have to be bought regularly.

    To spell it out, Comcast can benefit from Disney’s content in the following ways:

    * By creating new cable channels based on Disney content.
    * Comcast Cable president Steve Burke, a former Disney executive, said in a media report last week that he envisioned all-Disney, all-the-time channels he could offer for $9.95 a month. Likewise, Comcast could sell movies from Disney’s vast archives.
    * With cross-promotion. Comcast could sell packages of commercial time for both Disney’s ESPN and Comcast’s Golf Channel, for instance, to advertisers willing to pay a bit more to be on both channels.
    * Bargaining power with other content providers. With its own supply of films, television shows and other features, a combined Comcast-Disney might be in a better position to negotiate with other content suppliers like TNT or HBO for cheaper prices.

    In all this drama, Disney’s boy Roy Disney remains his silence on Comcast’s offer for the company.

  • Comcast makes $66 billion bid for Disney

    Comcast makes $66 billion bid for Disney

    MUMBAI: Cable television powerhouse Comcast Corporation today announced that it has made a proposal to The Walt Disney Company to merge the two companies in a tax-free transaction worth $ 66 billion.

    The combination would create of the world’s largest by far media behemoth that will have a capitalisation of $142.37 billion. The merged entity would constitute a media monster that would literally dwarf its next closest media rival, Time Warner, which has a market cap of $80.74 billion.

    The proposed deal would give Comcast shareholders a 58 per cent stake in the merged company, which Comcast president-CEO Brian Roberts, said would be in a position to “compete vigorously with other entertainment and communications companies, including newly created integrated distribution/content providers.”

    The offer, couldn’t have come at a worse time for Disney chairman Michael Eisner who has enough on his plate fighting a flanking attack by Roy Disney, nephew of founder Walt Disney, who is leading a group of disgruntled shareholders demanding his ouster. Disney’s case has been further strengthened by the broadside delivered by Pixar chief Steve Job when his animation company announced it was parting ways with the Little Big Mouse.

    In his public offer to acquire Disney, Roberts said Eisner rebuffed an offer made earlier this week and consequently is taking the proposal “directly to you and your board.”

    The terms of the proposed transaction are as follows:

    * Comcast would issue 0.78 of a share of Comcast Class A voting common stock for each Disney share.
    * Disney shareholders would receive a premium of over $5 billion, based on yesterday’s closing prices, plus full participation in the combination benefits.
    * Comcast’s proposal values Disney at $66 billion (which includes assumption of $11.9 billion of Disney’s net debt), offering a multiple of approximately 14x Disney’s 2004 estimated EBITDA.
    * Disney shareholders would own 42% of the combined company.

    “This is a unique opportunity for all shareholders of Comcast and Disney to create a new leader of the entertainment and communications industry,” said Comcast president and CEO Brian L Roberts. “Not only would this merger create significant shareholder value, but it would also position the combined company to compete vigorously with other entertainment and communications companies, including newly created integrated distribution/content providers.”

    “Our management team has a proven track record of successful integration of our merger partners,” said Roberts. “We are prepared, ready and excited to greet the opportunities and challenges the proposed combination presents in order to deliver substantial value to shareholders of the new combined company.”

    Comcast Cable president Steve Burke added, “I know Disney’s businesses very well. And I am confident that when we put those great brands and programming assets together with our distribution, there will be significant opportunities to produce compelling returns for shareholders.”

    An official release informs that the superior track record of Comcast’s management is shown by its success in the acquisition of AT&T Broadband, which was twice the size of Comcast when acquired fifteen months ago. Performance of the merged company has far exceeded initial margin improvement expectations. The combination has resulted in immediate reversal of basic subscriber loss and acceleration of system upgrades, as well as significant launches of new products and services such as video-on-demand and HDTV.

    As part of the proposal, Comcast has noted the applicability of the FCC’s current program access and program carriage rules to the combined company, which should address potential concerns that could be raised in the regulatory process. Those rules ensure that the combined company will continue to make all of its satellite-delivered national and regional cable networks available on a non-exclusive, non-discriminatory basis and that there will be no discrimination against unaffiliated programming services, all comparable to the undertakings made by News Corp. in its recent acquisition of DirecTV.

    The distribution platforms under the combined company would be the Broadband Cable Platform with a total of 21.47 MM subscribers, 39.8 MM homes passed, top 25 market presence and also a High Speed Internet Platform with a subscriber base of 5.28 MM. The TV and radio assets of companies will include the ABC Television Network, 10 local TV stations and 72 radio stations.

    Under the entertainment brands of the two companies fall, ESPN, ESPN2, Regional Sports Nets, The Golf Channel and the Outdoor Life Network in the sports networks. Under the children’s networks fall the Disney Channel and Toon Disney; while E! Entertainment, ABC Family and Style fall under the entertainment networks of the two companies. Also Studio and Filmed Entertainment Library and Amusement Park Assets add to the infrastructure of the two companies.

    Comcast is being advised by Morgan Stanley, JPMorgan, Quadrangle Group and Rohatyn Associates. Davis Polk & Wardwell is the legal advisor to Comcast.

    Of course, even if Disney shareholders approve the offer (which is likely to be fiercely resisted by Eisner and his supporters), the deal would face scrutiny from the regulatory authorities.

  • Disney board shield Michael Eisner from critics

    Disney board shield Michael Eisner from critics

    MUMBAI: The Walt Disney Company’s board said yesterday that the campaign by two former directors, Roy Disney and Stanley Gold, to oust the chief executive, Michael Eisner, was misleading and distracted the company’s leaders from a turnaround that started last year.

    The board vowed “to set the record straight” in its letter, which comes in response to repeated criticism from Roy Disney and his ally Stanley Gold, both of whom resigned from Disney’s board last year. It said that the two former directors backed some decisions they now condemn.

    Disney and Gold have mounted a protest campaign to vote against the reelection of Eisner and three other board members at the 3 March annual meeting.

    The letter to the shareholders is the most detailed response from the company or its board since Disney and Gold resigned last year and started the campaign. The duo have criticised Eisner, saying that he has failed to revive the ABC television network and has alienated business partners.

    Roy Disney also accused Eisner of draining the creativity from the company and mismanaging its finances over the past decade. As a retort, the board said that the attack was based on distorted evidence.

    The board’s 13 directors, including Eisner, also said they intended to add another independent director this year.