Pixar (NASDAQ:PIXR)
Historical Stock Chart
From May 2019 to May 2024
The Walt Disney Company (NYSE: DIS):
-- Ed Catmull Named President of the Combined Pixar and Disney
Animation Studios and John Lasseter Named Chief Creative
Officer; Steve Jobs to Join Disney's Board of Directors
-- Disney Increases Stock Repurchase Authorization
Furthering its strategy of delivering outstanding creative
content, Robert A. Iger, President and Chief Executive Officer of The
Walt Disney Company (NYSE: DIS), announced today that Disney has
agreed to acquire computer animation leader Pixar (NASDAQ: PIXR) in an
all-stock transaction, expected to be completed by this summer. Under
terms of the agreement, 2.3 Disney shares will be issued for each
Pixar share. Based on Pixar's fully diluted shares outstanding, the
transaction value is $7.4 billion ($6.3 billion net of Pixar's cash of
just over $1 billion)(a).
This acquisition combines Pixar's preeminent creative and
technological resources with Disney's unparalleled portfolio of
world-class family entertainment, characters, theme parks and other
franchises, resulting in vast potential for new landmark creative
output and technological innovation that can fuel future growth across
Disney's businesses. Garnering an impressive 20 Academy Awards,
Pixar's creative team and global box office success have made it a
leader in quality family entertainment through incomparable
storytelling abilities, creative vision and innovative technical
artistry.
"With this transaction, we welcome and embrace Pixar's unique
culture, which for two decades, has fostered some of the most
innovative and successful films in history. The talented Pixar team
has delivered outstanding animation coupled with compelling stories
and enduring characters that have captivated audiences of all ages
worldwide and redefined the genre by setting a new standard of
excellence," Iger said. "The addition of Pixar significantly enhances
Disney animation, which is a critical creative engine for driving
growth across our businesses. This investment significantly advances
our strategic priorities, which include -- first and foremost --
delivering high-quality, compelling creative content to consumers, the
application of new technology and global expansion to drive long-term
shareholder value."
Pixar President Ed Catmull will serve as President of the new
Pixar and Disney animation studios, reporting to Iger and Dick Cook,
Chairman of The Walt Disney Studios. In addition, Pixar Executive Vice
President John Lasseter will be Chief Creative Officer of the
animation studios, as well as Principal Creative Advisor at Walt
Disney Imagineering, where he will provide his expertise in the design
of new attractions for Disney theme parks around the world, reporting
directly to Iger. Pixar Chairman and CEO Steve Jobs will be appointed
to Disney's Board of Directors as a non-independent member. With the
addition of Jobs, 11 of Disney's 14 directors will be independent.
Both Disney and Pixar animation units will retain their current
operations and locations.
"Disney and Pixar can now collaborate without the barriers that
come from two different companies with two different sets of
shareholders," said Jobs. "Now, everyone can focus on what is most
important, creating innovative stories, characters and films that
delight millions of people around the world."
"Pixar's culture of collaboration and innovation has its roots in
Disney Animation. Our story and production processes are derivatives
of the Walt Disney `school' of animated filmmaking," said Dr. Catmull.
"Just like the Disney classics, Pixar's films are made for family
audiences the world over and, most importantly, for the child in
everyone. We can think of nothing better for us than to continue to
make great movies with Disney."
The acquisition brings to Disney the talented creative teams
behind the tremendously popular original Pixar blockbusters, who will
now be involved in the nurturing and future development of these
properties, including potential feature animation sequels. Pixar's
20-year unrivaled creative track record includes the hits Toy Story,
Toy Story 2, A Bug's Life, Monsters, Inc., Finding Nemo and The
Incredibles. Disney will also have increased ability to fully
capitalize on Pixar-created characters and franchises on high-growth
digital platforms such as video games, broadband and wireless, as well
as traditional media outlets, including theme parks, consumer products
and live stage plays.
"For many of us at Pixar, it was the magic of Disney that
influenced us to pursue our dreams of becoming animators, artists,
storytellers and filmmakers," said Lasseter. "For 20 years we have
created our films in the manner inspired by Walt Disney and the great
Disney animators -- great stories and characters in an environment
made richer by technical advances. It is exciting to continue in this
tradition with Disney, the studio that started it all."
"The wonderfully productive 15-year partnership that exists
between Disney and Pixar provides a strong foundation that embodies
our collective spirit of creativity and imagination," said Cook.
"Under this new, strengthened animation unit, we expect to continue to
grow and flourish."
Disney first entered into a feature film agreement with Pixar in
1991, resulting in the release of Toy Story, which was hailed as an
instant classic upon its release in November 1995. In 1997, Disney
extended its relationship with Pixar by entering into a co-production
agreement, under which Pixar agreed to produce on an exclusive basis
five original computer-animated feature films for distribution by
Disney. Pixar is currently in production on the final film under that
agreement, Cars, to be distributed by Disney on June 9.
The Boards of Directors of Disney and Pixar have approved the
transaction, which is subject to clearance under the Hart-Scott-Rodino
Antritrust Improvements Act, certain non-United States merger control
regulations, and other customary closing conditions. The agreement
will require the approval of Pixar's shareholders. Jobs, who owns
approximately 50.6% of the outstanding Pixar shares, has agreed to
vote a number of shares equal to 40% of the outstanding shares in
favor of the transaction.
The Disney Board was advised by Goldman, Sachs & Co. and Bear,
Stearns & Co. The Pixar Board was advised by Credit Suisse.
Separately, the Disney Board approved the repurchase of
approximately 225 million additional shares, bringing the Company's
total available authorization to 400 million shares. Since August 2004
through the end of December 2005, Disney has invested nearly $4
billion to purchase nearly 155 million shares. Disney anticipates
further significant share repurchases going forward, reflecting
Disney's continued commitment to returning value to shareholders over
time.
(a) Based on Disney's closing share price of $25.52 as of 1/23/06.
About The Walt Disney Company:
The Walt Disney Company (NYSE:DIS), together with its subsidiaries
and affiliates, is a leading diversified international family
entertainment and media enterprise with four business segments: media
networks, parks and resorts, studio entertainment and consumer
products. Disney is a Dow 30 company, had annual revenues of nearly
$32 billion in its most recent fiscal year, and a market
capitalization of approximately $50 billion as of January 23, 2006.
Investor Conference Call:
An investor conference call will take place at approximately 2:15
p.m. PT / 5:15 p.m. ET today, January 24, 2006. To listen to the
Webcast, turn your browser to www.disney.com/investors/presentations
or http://corporate.pixar.com.
If you cannot participate in the live Webcast, re-plays will be
available for domestic callers at (888) 286-8010 (PIN 56666399) and
for international callers at (617) 801-6888 (PIN 56666399), or at
www.disney.com/investors/presentations until 4:00 p.m. PT on Tuesday,
February 7, 2006. An .mp3 version of this Webcast replay will also be
available approximately 24 hours after the Webcast concludes at
www.disney.com/investors/presentations.
Forward-Looking Statements:
Certain statements in this press release may constitute
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements are made on
the basis of the views and assumptions of the management of The Walt
Disney Company and Pixar regarding future events and business
performance as of the time the statements are made and they do not
undertake any obligation to update these statements. Actual results
may differ materially from those expressed or implied. Such
differences may result from legal or regulatory proceedings or other
factors that affect the timing or ability to complete the transactions
contemplated herein, actions taken by either of the companies,
including restructuring or strategic initiatives (including capital
investments or asset acquisitions or dispositions), as well as from
developments beyond the companies' control, including: adverse weather
conditions or natural disasters; health concerns; international,
political or military developments; technological developments; and
changes in domestic and global economic conditions, competitive
conditions and consumer preferences. Such developments may affect
assumptions regarding the operations of the businesses of The Walt
Disney Company and Pixar separately or as combined entities including,
among other things, the timing of the transaction, the performance of
the companies' theatrical and home entertainment releases, expenses of
providing medical and pension benefits, and demand for products and
performance of some or all company businesses either directly or
through their impact on those who distribute our products. Additional
factors that may affect results are set forth in the Annual Report on
Form 10-K of The Walt Disney Company for the year ended October 1,
2005 under the heading "Item 1A--Risk Factors" and in the Quarterly
Report on Form 10-Q of Pixar for the quarter ended October 1, 2005
under the heading "Risk Factors" section of Part I, Item 2.
For Additional Information:
This material is not a substitute for the prospectus/proxy
statement Disney and Pixar will file with the Securities and Exchange
Commission. Investors are urged to read the prospectus/proxy statement
which will contain important information, including detailed risk
factors, when it becomes available. The prospectus/proxy statement and
other documents which will be filed by Disney and Pixar with the
Securities and Exchange Commission will be available free of charge at
the SEC's website, www.sec.gov, or by directing a request when such a
filing is made to The Walt Disney Company, 500 South Buena Vista
Street, Burbank, CA 91521-9722, Attention: Shareholder Services or by
directing a request when such a filing is made to Pixar, 1200 Park
Avenue, Emeryville, CA 94608.
Pixar, its directors, and certain of its executive officers may be
considered participants in the solicitation of proxies in connection
with the proposed transactions. Information about the directors and
executive officers of Pixar and their ownership of Pixar stock is set
forth in the proxy statement for Pixar's 2005 annual meeting of
shareholders. Investors may obtain additional information regarding
the interests of such participants by reading the prospectus/proxy
statement when it becomes available.