Disney CEO Iger's contract reportedly being extended soon

Disney CEO Bob Iger

The chances that Disney CEO Bob Iger stays on past June 2018 appear to be increasing.

According to the Los Angeles Times, Disney’s board of directors might soon extend Iger’s contract past its current expiration date, as the current search for a replacement CEO has yet to yield results.

Last month, the Wall Street Journal cited sources familiar with Disney’s plans who said progress finding a replacement for Iger has stalled since would-be heir COO Tom Staggs left last year.

Iger has said that he would be open to staying on longer if the board deemed it necessary for the good of the company. It’s unclear if Disney or Iger will announce anything about a contract extension when Disney holds its annual shareholders meeting on Wednesday.

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In light of Disney’s struggles with ESPN—which is reportedly readying another round of layoffs—Iger may be looking to pursue more M&A activity to maintain growth at Disney while its linear TV business is hurting, according to Barclays analyst Kannan Venkateshwar.

"Early in Mr. Iger’s tenure, he advocated a strategic shift towards studios with the acquisition of Pixar, Marvel and Lucas films [sic], which have driven growth since. Given this historical context, it wouldn’t be surprising for Disney to look out to the next decade and try to solve for assets that it would need to remain competitive, especially if Mr. Iger remains CEO for a few more years,” wrote Venkateshwar.

He goes on to note that the “biggest hole” in Disney’s capabilities at present is distribution.

“In this state of the world, while an asset like BAM Tech is quite an important component to reach consumers directly, BAM Tech does not provide Disney with front end retail relationships on scale to make a difference to Disney today. We believe in order to remain competitive in a world where digital access platforms like Google, Facebook, Twitter, etc. could look to acquire sports rights and other media content, success will be determined by the ability to bundle media with more services,” wrote Venkateshwar. “It will be tough, in our opinion, for Disney to build these capabilities group up. Consequently, we believe if Mr. Iger does extend his contract for a few more years, he could focus more on gaining a scaled distribution platform.”