Walt Disney Co. is mired in chaos amid the company’s shocking switch in leadership — with media mogul Bob Iger taking the reins back from a CEO he reportedly once branded as a “novice” for landing the Mouse House in a political mess.
The 71-year-old Iger — who had handed the chief executive role to Bob Chapek in January 2020, just before the pandemic slammed Disney’s theme parks and movie business — was approached by the company’s board in recent days about retaking the helm, a source close to the situation told The Post.
That’s despite the fact that the board had renewed Chapek’s contract this summer, putting Disney shareholders on the hook for a $23 million golden parachute for Chapek, a 62-year-old marketing executive who had done a lengthy stint at HJ Heinz before coming to Disney.
Now, Iger — who just months after Chapek’s contract was renewed had said tapping him as his successor was one of his “worst business decisions” — is faced with undoing the damage, pledging to stay at the company for two years until he finds another successor. Rumored candidates include current Disney exec Dana Walden, former Disney execs Tom Staggs, Kevin Mayer or even Peter Rice, who got unceremoniously fired by Chapek this summer.
Chapek’s gaffes include a botched response to Florida’s “Don’t Say Gay” law which provoked a battle with Gov. Ron DeSantis and ended in Disney World losing its special-self governing tax status. Disney likewise faces outrage from customers over sky-high price increases at Disney theme parks amid complaints of lousy food and grimy, rundown amenities. Last week, Disney World hiked its price of entry to as high as $189 per person.
Despite a reputation for understatement and grace under pressure, Iger in recent months reportedly had let his frustrations with Chapek boil over in private conversations. In July, Insider reported that Iger found Chapek to be a “novice” in responding to crises such as the company’s contract dispute with “Black Widow” actress Scarlett Johansson as well as “Don’t Say Gay.”
In the months following Chapek’s tenure as CEO, Iger told confidants that he was unhappy with his successor. According to Insider, Iger called the selection of Chapek as Disney CEO “one of his worst business decisions.”
“He said he was tired of being harangued about [succession] and said, ‘Fine, you guys have someone else run the business,’” a former Disney executive told Insider regarding Iger’s initial decision to step down and name Chapek to succeed him.
“He greatly regretted it as soon as COVID hit,” the executive added.
That was after CNBC reported in March that the pair had begun squabbling in early 2020, just two months after Chapek took the reins, when Iger told a reporter he planned on “actively helping” Chapek grapple with the pandemic crisis. Chapek was “furious” and “wasn’t looking for a white knight,” and relations between the two have been chilly ever since, according to the report.
A month earlier, Iger had raised eyebrows when he weighed in on “Don’t Say Gay” after Chapek was blasted for flip-flopping on the issue under pressure from Florida politicians.
“A lot of these issues are not necessarily political,” Iger told CNN’s Chris Wallace. “It’s about right and wrong. So, I happen to feel and I tweeted an opinion about the ‘Don’t Say Gay’ bill in Florida.”
Two weeks ago, Disney revealed a worse-than-expected quarterly loss of $1.5 billion linked to its Disney+ streaming service that sent the company’s shares tumbling. As Chapek began to impose cost cuts that alienated already-hostile employee ranks, Iger saw an opening to mount a comeback that insiders had speculated about for months.
Iger’s return may “calm investors” and “placate” the rank-and-file who “fondly recall Iger’s successful first run at the helm,” but don’t expect smooth sailing for the CEO, said Paul Verna, an analyst at Insider Intelligence.
Shortly after Disney revealed its massive loss on Nov. 8, billionaire Nelson Peltz’s hedge fund Trian took an $800 million stake in the company. In addition to seeking cost cuts and a seat on the board, Peltz thinks “Iger shouldn’t be back in control of the company,” the Journal reported, citing sources.
“The conditions that led to Disney’s struggles won’t be easily solved by a charismatic leader,” Verna said. “This time, Iger will confront unfavorable economic conditions, intensifying competition, widespread malaise across tech and media, global conflict, and a political environment that can corner companies into no-win scenarios.”
Some insiders say Chapek shouldn’t have been entirely surprised by his sudden exit. That’s because he was “always hated by creatives” at the company — a crucial constituency — despite his success running the company’s theme parks, according to one source close to the situation.
“Chapek didn’t have the acumen, he didn’t have creativity, and he wasn’t respected by employees … he was zero for three,” the source said. “Running parks is like running a mall… you can’t go from that to being a genius on content.”
On Monday, however, tech blogger Ben Thompson noted that it was Iger’s decision to buy 20th Century Fox to form Disney+, whose mounting losses have been a key reason that Chapek has been hiking prices at the theme parks, riling Disney fans.
“Chapek played the hand that was dealt him by Bob Iger,” Thompson wrote on his “Stratechery” blog. “Perhaps Iger has come to realize that the all-in bet on Disney+ was itself the problem: in other words, he is coming back not to fix Chapek’s mess, but to fix his own.”
Nevertheless, other analysts say they are optimistic that Iger’s cool-headed charisma will help navigate the company out of its current mess. While Iger appears to be more “woke” politically than Chapek, his straightforwardness about his positions may serve the company better than Chapek’s fumbling, analysts said.
“We believe investors will value the transparency and return Disney some of its long-lost magic with a stronger narrative driving the stock higher again,” said Michael Nathanson, an analyst at MoffatNathanson who called Iger “a constant ballast in the rougest of media waters.”
Nathanson raised his rating on Disney’s stock to “outperform,” up from “market perform.” Disney shares on Monday were up 5.7% at $97..08.
Lydia Moynihan contributed reporting.
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