5 Theories on Thomas Staggs’ Abrupt Departure

An awkward pall hung over the April 4 premiere of Disney’s The Jungle Book reboot. Hours before CEO Bob Iger, 65, walked the red carpet in Hollywood, the company had revealed that his heir apparent, COO Thomas Staggs, 55, will step down. The move, which left many at the premiere shocked, threw a carefully choreographed succession plan into disarray as Iger’s contract expires in June 2018. Disney isn’t talking, but insiders and observers have theories.

Here are five:

1. Sheryl Sandberg wants the job

The Facebook COO has served on Disney’s board since 2009 and, according to some, has made it known she would like a CEO position that likely never will become available at Mark Zuckerberg’s company. While Sandberg, 46, lacks traditional Hollywood experience, she is savvy in digital media, which could be crucial as Disney faces a declining cable business.

2. Staggs lost the board

Some insiders say Disney board members ultimately believed Staggs, who came from the company’s parks division, lacks the creative experience in TV or film needed as CEO. “This would speak to the Disney board’s view of the importance of these businesses,” says Macquarie Group analyst Tim Nollen.

3. There’s an internal candidate

Many have focused on the possibility that Disney will look outside the company for a new leader (Chase Carey? Steve Burke?). But there are internal contenders, too. Bob Chapek, 57, who replaced Staggs atop the parks unit and once ran consumer products, is considered an Iger favorite, as is Ben Sherwood, promoted in 2015 from running ABC News to co-chairman of Disney Media Networks. Sherwood, 52, certainly has creative experience.

4. Staggs took the fall for Iger’s frustration

Running parks from 2010 to 2015, Staggs was the primary executive on Disney’s Shanghai resort, one of Iger’s key legacies. Disney and its China partners had planned to open the $5.5 billion park by the end of 2015, but they pushed it to June, when portions reportedly still will be unfinished. In addition, Disney’s parks division was the source of a major PR flap when it allegedly laid off 250 tech workers at its Orlando resorts in 2015 and replaced them with foreign workers using H-1B visas. Some of those laid off are suing, which is said to have enraged Iger.

5. Iger just wants to stay

It could be that simple. Iger’s post-Disney plan was set to include helping build an NFL stadium in Southern California for both the Raiders and Chargers, and he’d have an ownership stake in one. But the NFL rejected the proposal in favor of a rival plan, leaving Iger with one fewer option after he’s through running Disney.

From The Hollywood Reporter

 

Disney Promotes Parks Chief Staggs, Seen as Successor to Iger

Staggs, Chairman of Walt Disney World Parks & Resorts speaks during a ribbon-cutting ceremony for the New Fantasyland in Lake Buena Vista, Florida

Walt Disney Company named Thomas Staggs, the head of its theme parks and resorts unit, as chief operating officer of the company on Thursday, putting him in the lead to succeed Chief Executive Officer Bob Iger in 2018.

Staggs will assume the role of COO immediately while he continues to run the parks business until a successor is named, Disney said in a statement.

Disney shares rose 1.2 percent to $102.52 in afternoon trading on the New York Stock Exchange.

The 63-year-old Iger, who has led Disney to record profits, recently extended his contract for a second time through June 2018. Staggs and Chief Financial Officer Jay Rasulo have been considered the top candidates to replace Iger, Wall Street analysts said.

Disney operates television networks including ABC and ESPN, theme parks on three continents, a movie studio and gaming and consumer products divisions. The company blew past Wall Street estimates when it released quarterly results on Tuesday, driving its stock to record highs.

Staggs, 54, is a 25-year veteran of Disney and previously served as CFO. He became head of the parks division in 2010, when Iger switched the jobs of Rasulo and Staggs so each could broaden experience.

Is Disney CFO Jay Rasulo About to be Named COO?

RASULO

From Variety

Jay Rasulo, senior executive VP and chief financial officer of the Walt Disney Co., whose longtime deal expires in two weeks, has not yet signed a new contract, according to a proxy statement the company filed with the Securities and Exchange Commission on Friday.

His decision to so far not file for an extension comes as Disney chief Bob Iger and the board are planning to name a chief operating officer by spring.

The new COO will most likely be groomed to replace Iger when he retires as chairman and CEO as planned on June 30, 2018. On March 12, Disney will hold its annual shareholders meeting in San Francisco, where 10 members of Disney’s board will be up for election, including Iger.

Rasulo isn’t the only executive vying for the post. Disney’s parks and resorts chief Thomas Staggs is also a serious contender for the COO role, and many believe he’s the frontrunner.

Rasulo, whose current deal expires Jan. 31, 2015, according to the proxy statement, is Disney’s second highest-paid executive behind Iger. In fiscal 2014, Iger earned $46.5 million in salary, stock and other compensation; Rasulo made $16 million, up from $10.7 million in fiscal 2013, the SEC document showed.

Given his financial experience, Rasulo could easily fit the bill of COO. And his reluctance to sign a new contract before Iger chooses a candidate makes sense. Working without a contract would give Rasulo the option to leave Disney without penalty should he oppose Iger’s choice.

According to the proxy statement, the increase in Rasulo’s earnings in 2014 was attributed to “effective management of efficiency across multiple areas of spending including leadership of a company-wide project that significantly reduced overhead costs over the past two years; leadership of multiple initiatives to build direct to consumer capabilities across the company through data analysis and the use of business intelligence technology” and his support of the acquisition and integration of Maker Studios, “opening a new content and distribution platform for the company.”

Rasulo’s ability to maintain a strong balance sheet, including successful debt offerings and negotiation of the recapitalization of Disneyland Paris; the continued reorganization and consolidation of corporate functions including sourcing and procurement, product integrity, cash forecasting, collections and corporate financial decision support; and management of philanthropic program, the Disney Citizenship group, also were cited.

Staggs previously spent 12 years as chief financial officer, also giving him the financial acumen for the COO position. He played a key role in acquiring Capital Cities/ABC, Pixar and Marvel, during which he worked closely with Iger. He first joined Disney as a manager of strategic planning in 1990.

He is in the midst of building Shanghai Disneyland, and expanding Animal Kingdom, in Orlando, with the addition of Avatar Land. Both parks are expected to be major revenue generators for the company. Parks and resorts are Disney’s second-largest contributor to its bottom line each year.

Disney and Shanghai Shendi Group, a consortium of state-owned companies in China, have committed $5.5 billion to build Shanghai Disneyland, with the Mouse House operating the park and carrying a controlling 43% stake.