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Disney hires advisers Goldman, Bear
By Russ Britt, CBS.MarketWatch.com
Last Update: 8:37 PM ET Feb. 24, 2004
LOS ANGELES (CBS.MW) -- Walt Disney said Tuesday it has hired Bear Stearns and Goldman Sachs as its financial advisers, as the company develops its strategy in response to Comcast's hostile takeover attempt.
Disney (DIS: news, chart, profile), which made the disclosure in a regulatory filing with the Securities and Exchange Commission, didn't discuss what the Wall Street firms would specifically work on, and officials at the Burbank, Calif.-based company did not immediately return calls seeking comment.
Although Disney has publicly rebuffed the Comcast (CMCSK: news, chart, profile) stock offer, valued at $60 billion including $12 billion in debt, the entertainment giant has yet to indicate how it would fight off the cable operator's proposal. Last week, Disney spurned the stock-swap offer, which values each Disney share at .78 a share of Comcast common stock, as too low.
By hiring Goldman Sachs, a noted takeover-defense strategist, Disney could also formulate other strategies in response to the bid by Comcast, such as making a significant acquisition of its own.
"It's hard to tell," said David Mantell, analyst for Loop Capital Markets in Chicago. "I think it might be indicative that there is a process in place."
But the defense planning may turn out to be academic, according to one analyst, who suggested Comcast likely would walk away from its offer in the wake of revelations that Disney's board had planned in advance to decline a Comcast proposal even before receiving it.
Analyst Richard Greenfield of New York-based Fulcrum Global Partners cited statements Monday in which members of Disney's board said they had prepared a statement in advance for Chairman Michael Eisner to decline the bid.
It had been speculated that Comcast would seek to buy Disney several weeks in advance of the bid, which was submitted by Comcast Chief Executive Brian Roberts to Eisner on Feb. 9. The proposed deal was made public two days later.
"We question how Disney's board of directors knew what they were responding to and why they would want responses 'set in stone' beforehand," Greenfield wrote in his remarks. "Logic and customary business practice would appear to dictate that a board would review and assess an open solicitation such as (the one) Mr. Roberts made."
Comcast had no comment.
Concerns among investors that Comcast's interest in the $60 billion deal may be decreasing cast down Disney shares by 3 percent Tuesday. Disney was off 79 cents to $25.96. Comcast shares climbed 20 cents to $28.90.
Also on Tuesday, Roy Disney and Stanley Gold continued their campaign to unseat Eisner and three board members. Gold and Disney sent a letter to the board seeking correspondence records between director Judith Estrin and Eisner's personal attorney, Irwin Russell.
Gold and Disney want to know if Estrin, who chairs the board's compensation committee, contacted Russell when he was determining Eisner's bonus for the 2002 and 2003 fiscal years.
Gold and Disney question whether Eisner should have received $5 million in stock options for 2002 while the company's shares fell that year.
Also, Robert A.G. Monks, the founder of Institutional Shareholder Services, issued a statement urging shareholders to vote against Eisner and presiding director George Mitchell, a former U.S. senator.
Calling Disney's executives a "value destroying management," Monks said: "A substantial 'no' vote will make clear that Disney shareholders insist on management of their property in their interest and not as the benefit of an entrenched executive."
Monks left ISS in 1990, five years after founding it, and went on to found corporate governance specialists Lens Governance Advisors.
Russ Britt is the Los Angeles Bureau Chief for CBS.MarketWatch.com.
Disney hires advisers Goldman, Bear
By Russ Britt, CBS.MarketWatch.com
Last Update: 8:37 PM ET Feb. 24, 2004
LOS ANGELES (CBS.MW) -- Walt Disney said Tuesday it has hired Bear Stearns and Goldman Sachs as its financial advisers, as the company develops its strategy in response to Comcast's hostile takeover attempt.
Disney (DIS: news, chart, profile), which made the disclosure in a regulatory filing with the Securities and Exchange Commission, didn't discuss what the Wall Street firms would specifically work on, and officials at the Burbank, Calif.-based company did not immediately return calls seeking comment.
Although Disney has publicly rebuffed the Comcast (CMCSK: news, chart, profile) stock offer, valued at $60 billion including $12 billion in debt, the entertainment giant has yet to indicate how it would fight off the cable operator's proposal. Last week, Disney spurned the stock-swap offer, which values each Disney share at .78 a share of Comcast common stock, as too low.
By hiring Goldman Sachs, a noted takeover-defense strategist, Disney could also formulate other strategies in response to the bid by Comcast, such as making a significant acquisition of its own.
"It's hard to tell," said David Mantell, analyst for Loop Capital Markets in Chicago. "I think it might be indicative that there is a process in place."
But the defense planning may turn out to be academic, according to one analyst, who suggested Comcast likely would walk away from its offer in the wake of revelations that Disney's board had planned in advance to decline a Comcast proposal even before receiving it.
Analyst Richard Greenfield of New York-based Fulcrum Global Partners cited statements Monday in which members of Disney's board said they had prepared a statement in advance for Chairman Michael Eisner to decline the bid.
It had been speculated that Comcast would seek to buy Disney several weeks in advance of the bid, which was submitted by Comcast Chief Executive Brian Roberts to Eisner on Feb. 9. The proposed deal was made public two days later.
"We question how Disney's board of directors knew what they were responding to and why they would want responses 'set in stone' beforehand," Greenfield wrote in his remarks. "Logic and customary business practice would appear to dictate that a board would review and assess an open solicitation such as (the one) Mr. Roberts made."
Comcast had no comment.
Concerns among investors that Comcast's interest in the $60 billion deal may be decreasing cast down Disney shares by 3 percent Tuesday. Disney was off 79 cents to $25.96. Comcast shares climbed 20 cents to $28.90.
Also on Tuesday, Roy Disney and Stanley Gold continued their campaign to unseat Eisner and three board members. Gold and Disney sent a letter to the board seeking correspondence records between director Judith Estrin and Eisner's personal attorney, Irwin Russell.
Gold and Disney want to know if Estrin, who chairs the board's compensation committee, contacted Russell when he was determining Eisner's bonus for the 2002 and 2003 fiscal years.
Gold and Disney question whether Eisner should have received $5 million in stock options for 2002 while the company's shares fell that year.
Also, Robert A.G. Monks, the founder of Institutional Shareholder Services, issued a statement urging shareholders to vote against Eisner and presiding director George Mitchell, a former U.S. senator.
Calling Disney's executives a "value destroying management," Monks said: "A substantial 'no' vote will make clear that Disney shareholders insist on management of their property in their interest and not as the benefit of an entrenched executive."
Monks left ISS in 1990, five years after founding it, and went on to found corporate governance specialists Lens Governance Advisors.
Russ Britt is the Los Angeles Bureau Chief for CBS.MarketWatch.com.