Disney’s Frenemy Wants to Come Back Home
The Wall Street Journal just published an article that explains how Disney’s frenemy wants to come back home.
Former longtime Disney executive Jay Rasulo has reemerged from a nearly decade-long sabbatical.
The former Disney CFO wants to push his way onto Disney’s Board of Directors, and he may have his eye on a bigger prize.
Jay Rasulo definitely wants back at Disney. He may be angling for Bob Iger’s job, too.
Here’s what we just learned.
Disney Knows Its Enemies
“Keep your friends close and your enemies closer,” so the saying goes.
For Disney CEO Bob Iger, that philosophy is readily apparent as he swims with sharks as a daily part of his job routine.
Iger must negotiate with some of the most powerful people in Hollywood, Wall Street, and the media.
Recently, the highly accomplished executive made his pitch on CNBC, offering the cable channel multiple scoops.
How did CNBC repay the favor? A reporter from the network attempted to sandbag and mock a member of Disney’s Board.
Similarly, other business-based publications continue to advocate activist investor Nelson Peltz’s positions.
This Wall Street Journal article, while extraordinarily fair to both sides, demonstrates the point.
In this piece, Jay Rasulo effectively reintroduces himself to investors, reminding them of what went down a decade ago.
As a reminder, Jay Rasulo once appeared like a 50/50 proposition, a veritable coin flip, to succeed Iger as Disney CEO.
Ultimately, Rasulo lost that coin flip to Thomas O. Staggs, who never became Disney CEO, either.
Many would argue that Iger never intended to leave Disney and merely went through the motions at the request of the Board.
Once Staggs emerged as the superior candidate, Iger stealthily positioned himself as Disney’s only viable choice as leader.
Rasulo left the company in 2015. Less than a year later, his presumed competitor, Staggs, exited Disney as well.
Now, a Ghosts of Christmas Past scenario has unfolded for Iger, as both Staggs and Rasulo suddenly factor into the CEO’s future once again.
Meanwhile, CNBC’s famous blowhard, Jim Cramer, has just stated that he’ll vote to add Nelson Peltz to Disney’s Board.
The last time Cramer spoke on Disney, Bob Chapek lost his job.
Suddenly, Jay Rasulo’s candidacy appears viable.
Remind Me Who Jay Rasulo Is
I get why you’re asking. Rasulo hasn’t been around Disney for nearly a decade, and he kinda slinked away into oblivion.
At the time, nobody expected Rasulo to vanish from sight.
Here’s a quote from a respected analyst on the day of Rasulo’s leaving Disney:
“What I would expect next is for Jay (Rasulo) to have several CEO offers, because he was runner-up for the biggest job in the media world.”
That…didn’t happen, as those offers never materialized.
The Wall Street Journal provides an update on Rasulo’s post-Disney career.
In November 2018, Rasulo joined iHeartMedia as a Board member.
The company lists Rasulo as “lead independent director” for at iHeartMedia.
When iHeartMedia evolved into its current form in July 2019, it had a stock price of $17.50.
Let’s glance at its current price to see how well Rasulo has…oh no. Ohnonono. Does that say $2? Eep.
Okay, I’m joking, but it’s a relevant discussion since Rasulo wants a seat on Disney’s Board and his recent job resume is…problematic.
You may wonder why Peltz and Isaac Perlmutter view the former Disney CFO as worthy of the job.
This article points out several significant career accomplishments by Rasulo, all of which Disney fans should admire and respect.
Rasulo managed Disneyland Paris for a time and committed himself to the job so much that he spoke fluent French by the end.
Disney rewarded him by naming him the head of the global parks division.
He was the equivalent of Josh D’Amaro in the early 2000s.
One of Rasulo’s greatest achievements was the Radiator Springs expansion at Disney California Adventure, which reinvigorated the park.
Later, Rasulo played an integral role in the opening of Shanghai Disneyland.
His successes have positively impacted the theme park division.
Why Peltz Likes Rasulo but Iger Doesn’t
Iger made his feelings clear about Rasulo in 2015 when he picked Staggs instead.
To Disney insiders, that decision wasn’t the least bit surprising. If you’ve read Iger’s Ride of a Lifetime, here’s all I need to say.
Rasulo came up through the Strategic Planning department at Disney.
Iger viewed that group as way too powerful and lacking in understanding of Disney’s core business tenets.
In that regard, Strategic Planning embodies Peltz’s push to join Disney. It’s a “numbers over people” business.
Rasulo was ultimately quite good at his job. Ergo, he repeatedly advanced in his career.
Then, when Iger gave Rasulo a chance to succeed him, the CFO failed.
Do you know which Disney executive really liked Rasulo?
That answer is Isaac Perlmutter, whose stock is currently inflating Peltz’s campaign.
As the article notes, Peltz recognized that his son wouldn’t gain a Board seat due to the (accurate) accusation of nepotism.
Peltz pivoted by finding a former Disney executive he liked whom he knew Iger wouldn’t want on the Board.
Now, articles like this are making the case for why people should consider Rasulo.
One coworker described the executive as “always a maniac about excellence.” That sounds decidedly Disney.
However, the article acknowledges the most often mentioned criticism of Rasulo, one he himself admits. Here’s his quote:
“I’m a very direct guy. Many people at Disney are not direct.”
“There are people who want to do their thing, and they don’t like it when someone calls them on it in a studio budget meeting, for example.”
Iger prefers his executives to feel empowered. Rasulo’s reputation is more of a “my way or the highway” type.
Ergo, we’re discussing a money-focused person who dictates to underlings rather than trusts co-workers.
Doesn’t that sound like Bob Chapek?
The Ultimate Plan
No matter how the Shareholder vote plays out at Disney, only two Board seats are legitimately in play.
Blackwell has a different offer that hasn’t gained traction.
After Disney’s last fiscal earnings report, most analysts were dismissing Peltz’s candidacy as well.
The recent comments by Cramer may alter that thinking, though.
This conversation matters because it’s only the first step in Peltz’s plan.
Ultimately, the goal here is to force Iger from Disney as soon as possible.
Peltz believes that if he gains two Board votes, he can persuade other members to vote for a leadership change.
Iger claims that succession remains at the forefront of Disney’s plans, but many investors don’t believe him.
With Peltz and Rasulo on the Board, the push becomes twofold.
After getting rid of Iger, Rasulo would position himself as the best candidate to succeed Iger as CEO.
Disney Chairman Mark Parker, the former head of Nike, appears unlikely to agree, and most Board members remain steadfastly loyal to Iger.
So, there’s a bit of wishcasting involved with Peltz and Rasulo’s plans.
Still, we have to take Rasulo, Peltz, and Perlmutter seriously as long as major media outlets continue to give them oxygen.
Iger and Rasulo were once friends, but critics now wonder whether the former Disney executive has vengeance in mind.
Disney’s frenemy definitely wants to come back to Disney. The lingering question is what he wants if he returns.
We may not fully understand what Rasulo’s goals are until the fox gets into the henhouse.
Also, I suspect we’re gonna have a wild month of disruptive Disney stories while waiting for the Shareholder vote on April 3rd.
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Feature Photo: (AP File photo)