Eisner’s Reign At Disney to End in 2006
Walt Disney Co.’s ceo Michael Eisner has announced that he is stepping down from his post when his contract expires in Sept. 2006, reports the WALL STREET JOURNAL. This move ends Eisner’s two-decade reign at the mega-corporation and comes six months after former board members Stanley Gold and Roy Disney tried to oust him from the firm. Gold and Disney’s efforts did lead to Eisner being removed as chairman. Disney president Robert Iger is Eisner’s "preferred choice" to succeed him.
Below is a copy of Eisner’s resignation letter to the board, followed by California Public Employees' Retirement System (CalPERS) statement regarding Eisner’s announcement. CalPERS is one of the leading shareholders in Walt Disney and withheld its vote for Eisner at the last shareholders’ meeting.
September 9, 2004
As we approach the end of the fiscal year and my 20th anniversary as ceo, I would like to share with you some personal observations about our Company. I have been honored and proud to be the chief executive officer of this remarkable company for that length of time. Let me touch on what we have accomplished, what we have to do, and some of my personal plans.
Putting last things first, I plan to retire from my role as chief executive officer of the company upon the conclusion of the term of my employment agreement on Sept. 30, 2006. 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.
As to our current performance, we are and should be proud of how we have managed and strengthened the company during difficult times. I won't repeat the detailed facts and figures which we have discussed or the comments made by me in the conference call to the financial community in August which I have already sent to you. I have been told by you, by friends, but mostly by outside observers, that it is quite extraordinary that we have been able to remain focused on our objectives and have managed to run the company so well amidst the distractions that have taken huge chunks of time during the past several years.
Disney's management team has proved its devotion to the company and has taken advice once offered by Babe Ruth. In the midst of a World Series, when asked how he keeps his cool when the fans go crazy, hollering and hooting every time he comes to bat, he explained: "I keep my eye on the ball". Our executive team has not been diverted from the task of creating intellectual product, efficiently running the company, and preparing for the future.
I know 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.
Most of you were not part of the company as we grew and prospered, both domestically and internationally since Frank Wells and I came aboard in September 1984. Statistics only tell part of the story, but let me throw out a few: Total number of employees - from 28,000 to 117,000; revenues from $1.7 billion to a projection of roughly $30 billion for this fiscal year; Enterprise Value from $2.8 billion to $57 billion. This, of course, is an outgrowth of the seven new parks, 28,458 new hotel rooms, 70 new cable channels around the world and 800 new movies we created.
Our major acquisition, CapCities/ABC, in January 1996 (whose value has gone from a net cost of $16 billion to an estimated analyst value of $39.1 billion-$53.3 billion), was most important to the continued growth of our company, in an era of consolidation of media, of production and distribution, and vast technological change.
Along the way, I have been well rewarded for my efforts and the company's performance. I have reinvested a substantial portion of those proceeds into Disney stock (14 million shares). That and my strong feelings for the company are the incentive to make the company even more successful and to be sure this success continues beyond my tenure as ceo.
Below is a copy of Eisner’s resignation letter to the board, followed by California Public Employees' Retirement System (CalPERS) statement regarding Eisner’s announcement. CalPERS is one of the leading shareholders in Walt Disney and withheld its vote for Eisner at the last shareholders’ meeting.
September 9, 2004
As we approach the end of the fiscal year and my 20th anniversary as ceo, I would like to share with you some personal observations about our Company. I have been honored and proud to be the chief executive officer of this remarkable company for that length of time. Let me touch on what we have accomplished, what we have to do, and some of my personal plans.
Putting last things first, I plan to retire from my role as chief executive officer of the company upon the conclusion of the term of my employment agreement on Sept. 30, 2006. 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.
As to our current performance, we are and should be proud of how we have managed and strengthened the company during difficult times. I won't repeat the detailed facts and figures which we have discussed or the comments made by me in the conference call to the financial community in August which I have already sent to you. I have been told by you, by friends, but mostly by outside observers, that it is quite extraordinary that we have been able to remain focused on our objectives and have managed to run the company so well amidst the distractions that have taken huge chunks of time during the past several years.
Disney's management team has proved its devotion to the company and has taken advice once offered by Babe Ruth. In the midst of a World Series, when asked how he keeps his cool when the fans go crazy, hollering and hooting every time he comes to bat, he explained: "I keep my eye on the ball". Our executive team has not been diverted from the task of creating intellectual product, efficiently running the company, and preparing for the future.
I know 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.
Most of you were not part of the company as we grew and prospered, both domestically and internationally since Frank Wells and I came aboard in September 1984. Statistics only tell part of the story, but let me throw out a few: Total number of employees - from 28,000 to 117,000; revenues from $1.7 billion to a projection of roughly $30 billion for this fiscal year; Enterprise Value from $2.8 billion to $57 billion. This, of course, is an outgrowth of the seven new parks, 28,458 new hotel rooms, 70 new cable channels around the world and 800 new movies we created.
Our major acquisition, CapCities/ABC, in January 1996 (whose value has gone from a net cost of $16 billion to an estimated analyst value of $39.1 billion-$53.3 billion), was most important to the continued growth of our company, in an era of consolidation of media, of production and distribution, and vast technological change.
Along the way, I have been well rewarded for my efforts and the company's performance. I have reinvested a substantial portion of those proceeds into Disney stock (14 million shares). That and my strong feelings for the company are the incentive to make the company even more successful and to be sure this success continues beyond my tenure as ceo.
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