Disney (DIS) secured yet another key backer in its high-profile battle against activist investor Nelson Peltz.
In a paper published on Monday and viewed by Yahoo Finance, proxy advisory firm Glass Lewis recommended shareholders support the company's current board and withhold votes for the nominees put forth by Peltz's Trian Fund Management and fellow activist Blackwells Capital.
"We believe investors would be best served endorsing the incumbent directors at this time," Glass Lewis wrote in its recommendation, adding it's "not convinced" the alternative candidates and proposals would deliver "a superior change relative to Disney's current composition."
Peltz is currently seeking board seats for himself, along with former Disney CFO Jay Rasulo. Blackwells supports the company's current board but has urged shareholders to vote for its three nominees as additions to it.
If the proxy battle continues to a vote, a shareholder meeting set to take place on April 3 will ultimately determine the board's fate.
Last year, Peltz and his hedge fund renewed a push to shake up Disney's board as the stock price hit multiyear lows.
Disney has been grappling with challenges that include a declining linear TV business, slower growth in its parks business, and losses in its streaming business.
Although Glass Lewis did point to those challenges, which have also included a high-profile political battle with Florida Governor Ron DeSantis and concerns surrounding succession, the firm said CEO Bob Iger's recent initiatives to turn around the business have delivered positive results.
"Most recent reported quarters suggest these efforts do, indeed, have promise, which we believe substantially raises the bar for change at this time," Glass Lewis said.
Trian recently published a 130-page white paper that blamed the board for Disney's underperformance and accused its members of lacking "focus, alignment and accountability."
In a presentation added to its Vote Disney website last week, Disney refuted Trian's arguments and criticized the paper for lacking "substance and thought."
Other shareholders have jumped into the fray as the proxy battle gains steam. Trian has received support from fellow activist investor Ancora.
Meanwhile, ValueAct Capital has come out against Peltz — giving Disney an extra boost in fighting off the billionaire investor. The activist entered into an information-sharing agreement with Disney, which ensures it will support the media giant's recommended slate of board nominees in exchange for information.
JPMorgan CEO Jamie Dimon has also publicly endorsed Disney's current board, along with Bob Iger's leadership. Notably, the bank is currently serving as a defensive adviser to the media giant.
Disney has also received backing from the grandchildren of Walt Disney and his brother Roy.
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at [email protected].
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