Pixar Holders OK Takeover by Disney

LOS ANGELES – Shareholders of Pixar Animation Studios Inc. Friday voted to approve the company’s acquisition by The Walt Disney Co. for $7.4 billion in stock.

The vote makes Pixar a wholly owned subsidiary of Disney and makes former Pixar Chief Executive Steve Jobs Disney’s single largest shareholder with about a 7 percent stake.

The deal is squarely aimed at restoring Disney’s luster as a leader in the animated film business. Disney’s own efforts have faltered over the past 10 years while Pixar’s films have been huge successes.

Jobs was named to Disney’s board as a non-independent member. He had already said he would cast his Pixar shares, which represents 40 percent of the company’s outstanding stock, in favor of the merger. Shareholders met briefly in San Francisco to ratify the deal.

Under the plan, Pixar shareholders will exchange each of their shares for 2.3 shares of Disney stock.

The acquisition closed quickly after the vote. Regulators had previously signed off on the deal.

“As we begin the next chapter, all of us at Disney are pleased to welcome the incredibly talented Pixar team to our company to continue to create quality entertainment for audiences to enjoy around the world,” Disney Chief Executive Robert Iger said in a statement.

As part of the deal, key Pixar figures will take executive positions at Disney’s animation and theme parks units. Pixar will keep its brand name and continue to be headquartered in Emeryville as part of an effort to preserve the creative culture that has fueled its success.

John Lasseter, who was Pixar’s executive vice president, becomes chief creative officer of the animation studios and principal creative adviser at Walt Disney Imagineering, which designs and builds the company’s theme parks.

Lasseter began his career as a Disney animator and is the creative force behind Pixar’s films. He will report directly to Iger.

Ed Catmull, who was Pixar’s president, will now serve as president of the combined Pixar and Disney animation studios, reporting to Iger and Dick Cook, chairman of The Walt Disney Studios.

The deal comes just a month before the partnership between the two companies was set to expire.

Disney agreed to finance the first computer-animated feature film, “Toy Story,” in 1991. The film was released in 1995, the same year Pixar became a public company.

The relationship between the two companies has produced a string of box-office hits, including the films “Finding Nemo” and “The Incredibles.” The seventh and last film under the old distribution agreement, “Cars,” will be released June 9.

Talks to extend the agreement began two years ago, but faltered in large part because of personal animosity between Jobs and former Disney CEO Michael Eisner. Talks resumed after Robert Iger was named to succeed Eisner as CEO last year.

Those talks graduated to discussions about an acquisition after Iger saw research that showed mothers with children under the age of 12 rated the Pixar brand ahead of Disney.

Iger told analysts in February that he became convinced Disney should buy Pixar after presiding over the opening of Hong Kong Disneyland last September.

“I was at the opening of Hong Kong Disneyland and standing with a few thousand other people watching the parade go by and I realized that there wasn’t a character in the parade that had come from a Disney animated film in the last 10 years except for Pixar,” Iger said.

“It really hit me hard that we had had 10 years of real failure in many respects in the business that I believe was the most vital to us.”

Shares of Disney rose 69 cents to $29.09 at the end of regular trading on the New York Stock Exchange. Shares of Pixar rose $2.41 to $67.69 at the end of trading on the Nasdaq Stock Market.



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