[Asia Economy New York=Special Correspondent Joselgina] Activist investor Daniel Loeb's Third Point has acquired shares in Disney and demanded the spin-off of the sports network ESPN.
According to economic media CNBC on the 15th (local time), Daniel Loeb stated in a letter sent to Disney CEO Bob Chapek, "The ESPN business generates significant excess cash flow for Disney."
He argued, "There is a strong case for spinning off ESPN," adding that the spin-off would provide greater flexibility in pursuing business strategies.
Currently, ESPN and its sister network ESPN2 charge subscribers about $10 per month. Additionally, the streaming service ESPN+ has recently grown rapidly through exclusive live broadcasts. Earlier, Disney announced that from the 23rd of this month, the price of ESPN+ will increase from $6.99 to $9.99 per month.
Daniel Loeb also demanded that Disney purchase Hulu's shares from Comcast and integrate them into Disney's D2C platform. Previously, Comcast agreed to sell its 33% stake in Hulu to Disney within two years. Loeb emphasized that Disney must make every effort to acquire Comcast's remaining shares before the 2024 deadline.
He stressed, "It would be wise for Disney to pay a slight premium to accelerate integration," adding, "We know this is a priority and hope the deal will be completed within about 18 months."
In response, Disney said, "We welcome the opinions of all investors." However, regarding Loeb's criticism of Disney's board, the company rebutted, "Our independent and experienced board possesses significant expertise in brand, consumer-facing and technology businesses, and talent-centric companies."
Daniel Loeb has previously invested in Disney. The most recent case was holding shares for two years from 2020 to early 2022, during which he pressured Disney to strengthen its streaming services.
This year, Disney's stock price has dropped about 20%. On the New York Stock Exchange just before the afternoon close, Disney's stock was trading about 2.2% higher than the previous session.
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