Activist investor Daniel Loeb has backed off from pushing Walt Disney to spin off ESPN, stating that he now has a “better understanding” of the potential for growth.
In a tweet last night, Loeb wrote: “We have a better understanding of @espn‘s potential as a standalone business and another vertical for $DIS to reach a global audience to generate ad and subscriber revenues.”
It comes after Bob Chapek told the Financial Times that he had resisted Loeb’s ambitions to reduce Disney’s debtload by offloading the network.
“If everyone wants to come in and buy it . . . I think that says something about its potential,” Chapek said. “I think its potential is within the Disney company.”
The top exec added that he was confident in Disney’s ability to restore growth at ESPN, a service best known for showing US live sports like National Football League and Major League Baseball.
Loeb’s Third Point hedge fund bought a $1bn stake in the media giant in August, putting increasing pressure on Disney’s ongoing strategy.
Chapek told the FT that he has “regular conversations” with the Loeb, which he said were “very collaborative, non-antagonistic and collegial”.