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Eisner says he'll leave board when contract ends in 2006

Walt Disney Co. chief executive Michael Eisner plans to quit the company's board when his contract expires in 2006, but said he won't leave Disney before then as some prominent shareholders have demanded.

He made his comments in the Oct. 4 issue of Fortune magazine, which released the article Monday.

Eisner announced two weeks ago that he intends to retire in two years. He also said he backs Disney president and chief operating officer Robert Iger as his successor.

That announcement did not satisfy two ex-board members, including Roy E. Disney, who have called for Eisner's ouster. Roy Disney and Stanley Gold have said they will nominate an alternate slate of directors next year if Eisner is not gone within six months.

The two dissidents have also rejected Iger and called on the Disney board to start an independent search for a new CEO. Disney's board is meeting this week and succession planning is on the agenda.

In the Fortune interview, Eisner ended speculation that he might become board chairman in 2006 and continue to run the company with his hand-picked successor.

"I have not asked the board to stay on the board or be chairman after the end of my contract," Eisner said. "My assumption is that I would not continue on the board or as chairman."

Eisner said he kept his decision a secret from Disney executives and released his retirement letter to the board an hour after he informed the last member of his intentions. The board must determine whether to hire an outside search firm as it considers Iger, he said.

"The board may decide to benchmark him against other people," said Eisner, who pointed to Iger's experience, success and understanding of the company as reasons to name him chief executive.