Posted on: Saturday, September 11, 2004
Embattled chief of Disney says he's gone in 2 years
By James Bates and Richard Verrier
Los Angeles Times
After a 20-year run marked by triumphs and turbulence, Michael Eisner said yesterday that he will leave his position as chief executive of Walt Disney Co. in September 2006, when his contract expires.
Associated Press The erosion of Eisner's reputation stands in sharp contrast to his earlier years at the company's helm, when he earned praise for orchestrating one of the most successful turnarounds in corporate history. Under Eisner, the company grew from $1.7 billion in revenue in 1984 to $30 billion today, boasting such successes as the film "The Lion King," the TV series "Home Improvement" and the ESPN sports channel.
In an interview yesterday, Eisner, 62, said the criticism played no role in his decision to set a departure date, which he called "an easy decision."
"I decided I was not going to be CEO forever," Eisner said.
Industry insiders speculated that Eisner's move may have been pre-emptive, to announce the departure without the embarrassment of being pushed to do so by his bosses on the board. A source close to the company said the board did not intend to renew Eisner's contract.
Some board members, the source said, are privately questioning whether it would be better for the company if Eisner leaves sooner, should a successor be found.
In a formal letter to directors, delivered late Thursday and reported in the Wall Street Journal, Eisner promised a transition that is "expeditious, efficient, and smooth and easy."
Writing in his usual chatty way, he described his tenure as a "fantastic Disney ride" and told board members: "We must not forget that we are always singing and dancing 'for our supper.' " He closed with the advertising slogan his wife, Jane, coined in 1986: "I'm going to Disneyland!"
Although Eisner had been conferring with her about his decision to leave, he kept top Disney executives in the dark. Studio chief Dick Cook learned of the decision secondhand when he received a phone call from one of his executives yesterday morning.
Now comes what will surely be one of the most closely watched executive beauty pageants in recent Hollywood history.
Chairman George Mitchell will head the search. In a statement, he said the board of directors "will continue to pursue its ongoing deliberative process regarding succession even as Michael continues to lead the company to achieve its goals."
Eisner has said his choice for the job is his second-in-command, President Robert Iger — who draws mixed reviews on Wall Street, in part because of his inability to revive the company's fourth-place ABC television network.
Eisner's announcement was welcomed by many on Wall Street. Some analysts have said that the uncertainty and conflict over the company's leadership has hurt Disney's stock among investors who put a premium on executive-suite stability.
Eisner's decision follows a year of criticism from investors, ex-board members and others who accused him of mismanaging the famed entertainment company and driving down its value. In March, Eisner suffered a stinging rebuke when 45 percent of the shares voted at the company annual meeting were withheld in protest against his re-election to the board.
Michael Eisner, CEO of Walt Disney Co., spoke Feb. 11 at the Disney World Resort in Florida. Eisner's contract expires in 2006, and he says he won't stay on. It's unclear if he would have been allowed to stay.
