LPWire: Disney and Gold Talk with Glass, Lewis & Co

Comments of Roy Disney and Stanley Gold From Glass Lewis Call With Institutional Investors

Glass, Lewis & Co., an analytical research and proxy advisory firm providing services to institutional investors with more than $3.5 trillion in assets under management, hosted a special Proxy Talk conference call for its institutional investor clients on Wednesday, Feb. 11 to discuss the upcoming election of directors of Walt Disney Co. and the announcement by Comcast Corp. of an unsolicited bid to acquire Walt Disney Co.

On the Proxy Talk conference call, Glass Lewis analysts questioned Roy Disney, the former vice chairman of the board and former chairman of the feature animation division of the Company, and former member of the board Stanley Gold.

Highlights of the call include:

With respect to the Comcast Corp. presentation and the areas that Comcast cited as operations of the Walt Disney Co. that could be improved, Mr. Gold stated: [Mr. Disney and I] could not have had a greater validation than the presentation Comcast gave this morning. If anybody looks at our flip-chart presentation and theirs you will see, although theirs is in color and a little fancier, quite honestly, [it contains] the same basic information about under-performance and, concurrent with that, an ability to improve those operations, [specifically,] animation, theme parks, ABC and ABC Family Channel, to name a few.

With respect to Michael Eisner's reported response to the Comcast offer, Mr. Gold stated: I would ask ... whether or not, when Michael turned down this offer, which appears to have been Monday, he even called his board to tell them that that was what he was doing and when the board actually knew about it. I think there [are] still big problems with governance here and governance over a meaningful issue.

Comcast Cable President Steve Burke is a former Disney executive. Mr. Gold had the following to say about Mr. Burke: [Steve] is a very able executive. During his tenure at Disney he did some creative things -- he ran a park. He is really the driving force behind the Disney stores and the merchandising in the days in which they were growing -- in "the great days" as Roy says -- and when he left they began to fall on bad times and have a real poor product selection. Steve himself is the kind of guy that Disney ought to be populating all of its divisions with ... Maybe the most important reason he left the company was Michael Eisner. Mr. Disney said: "[Steve] was really a Disney kind of guy."

-- With respect to Pixar and the termination of Pixar's relationship with the Walt Disney Co., Mr. Gold said: And you cannot get the right people to come to Disney today with Michael Eisner there. I mean, look, Steve Jobs was there -- he left. [Steve Jobs] has turned down a deal that is better than he will receive somewhere else because he cannot work in an atmosphere created by Michael [Eisner] ... I have reason to believe that if Michael Eisner were gone, you could do a deal with Pixar on acceptable terms.

-- With respect to the directors of the Walt Disney Co., Mr. Disney and Mr. Gold were reminded of their letter to the Securities and Exchange Commission dated Dec. 21, 2003. In it, they wrote: We have too often encountered board members who know very little about the Company on whose board they sit, are unwilling or unable to invest the time and effort necessary to learn and, as a consequence, attempt to "hide" from dialogue that might expose their shortcomings and insecurities.

Mr. Disney and Mr. Gold were asked, "[I]s that the Disney board?"

Mr. Disney responded: "You bet." And Mr. Gold said: "Yes. True. It's true." He continued: [T]here are people on this board who don't know the difference between box office gross and distributors' net and don't know between a share rating point and a percent of the audience.

-- With respect to a prospective replacement for Michael Eisner, Mr. Gold was asked whether he and Mr. Disney have a particular person in mind. Mr. Gold responded: "Sure."

When asked for the name of the person, Mr. Gold said, "Can't tell you."

Mr. Disney added, "You need to [understand that Mr. Eisner] spent a lot of time creating this myth of irreplaceability."

And, Mr. Gold said: "They're five, six people who come to mind. ... The fact is, that there is at least a half a dozen very good people out there that I think could do this job and probably would do it if it were offered."

About Glass, Lewis & Co.
Glass, Lewis & Co. is an analytical research firm that uses proprietary research and extensive analysis to objectively evaluate the corporate integrity and financial transparency of public companies. Glass Lewis enables financial institutions to maximize the value of their portfolios by making better investment and proxy voting decisions. Glass Lewis assiduously avoids all conflicts of interest; its services are exclusively for institutional investors and other institutional participants in the financial and capital markets.

For more information about Glass, Lewis & Co., visit http://www.glasslewis.com /

--Posted February 12, 2004
Source: Glass, Lewis & Co