Bob Iger and actor Billy Crystal attend the world premiere of Disney Pixar’s “Monsters University” at the El Capitan Theatre on June 17, 2013 in Hollywood, California.
Kevin Winter | Getty Images Entertainment | Getty Images
During his first earnings call as CEO in 2005, Bob Iger told investors that under his direction Walt Disney would be “disciplined” in its approach to acquisitions, seeking out opportunities that helped the business adapt, not just expand for the sake of expansion.
Within two months of that call, he announced that Disney would acquire Pixar Animation Studios for $7.4 billion.
Looking back, Iger — who stepped down from the top executive seat in 2020 — says he is most proud of this acquisition.
“I’m proud of a lot of the decisions that were made,” he said in an interview on “Squawk on the Street” with CNBC’s David Faber aired on Tuesday. “Certainly, the acquisitions — I’d say of all of them — Pixar, because it was the first. And it put us on the path to achieving what I wanted to achieve, which is scale when it comes to storytelling. That was probably the best.”
When Disney first announced the acquisition, analysts were skeptical. Some felt that Disney had paid too much for the animation studio. Even the company’s board and its former CEO questioned the multibillion-dollar deal.
Now, Iger is lauded as a genius. Since Pixar’s first film “Toy Story” debuted in 1995, the animation studio has tallied more than $14.7 billion in sales at the global box office. Around $11.5 billion of that has come after Disney’s acquisition, according to data from Comscore.
“What I wanted to do more than anything is, I wanted to send a signal to everybody at Disney that it was a new day, that we were more open-minded about expansion, in particular about partnerships,” Iger said. “That creativity was the most important strategy for the company. And Pixar, at that point, exemplified original storytelling and quality and creativity at in its highest form.”
At the time of the Pixar acquisition, Disney animation was struggling to repeat the successful string of animated features it created in the ’90s, including “The Lion King,” “Aladdin” and “Pocahontas.”
Disney already had a relationship with Pixar, having co-produced films like “Toy Story,” “Monsters, Inc.” and “Finding Nemo” and aided with the films’ distribution. Iger saw a company full of innovation and creativity that he could use to revitalize Disney animation.
Iger noted that how Disney handled the integration of Pixar into its company helped persuade other brand owners to trust that their legacy wouldn’t be lost. This includes Marvel and Lucasfilm. Iger was also instrumental in brokering the deal to acquire 20th Century Fox.
“You look at ‘Frozen’ and you look at ‘Moana’ and you look at ‘Zootopia’ and you look at ‘Wreck It Ralph’ and you look at ‘Tangled’ and the number of Academy Awards and the box-office success, and all of the IP that that created — generated,” Iger said. “You know, it all was tied really, everything that we’ve done at Disney animation since then was tied to the Pixar acquisition.”
Disney shares closed down 1.5% at $146.47 on Monday. The stock has dropped more than 19% so far in 2021, putting its market value at $266.23 billion.
Tune into CNBC throughout the day to see more of David Faber’s interview with Bob Iger.