Disney CFO Jay Rasulo, passed over for No. 2 role, will step down

Walt Disney Co. Chief Financial Officer Jay Rasulo, who earlier this year was passed over for the Burbank company’s No. 2 job, will step down from his post at the end of the month.

Rasulo’s impending departure is the latest change in the executive ranks of the entertainment giant. The moves have been triggered by Disney’s elevation of Thomas Staggs — the former head of the company’s parks and resorts division — to the chief operating officer role in February.

Rasulo and Staggs had competed for that coveted job, which is widely seen as a grooming post for the company’s next CEO. Disney Chairman and Chief Executive Robert Iger is expected to retire when his contract expires in 2018.

Now, Staggs’ former rival will move on — perhaps to a top job at another entertainment and media firm, analysts said.

“What I would expect next is for Jay to have several CEO offers, because he was runner-up for the biggest job in the media world,” said Laura Martin, an analyst at Needham & Co. who covers Disney. “I think he is a really capable operator.”

After being passed over, Rasulo, 59, was widely expected to depart the company he’d worked for since 1986 in various roles, including as chairman of the parks and resorts unit.

Disney has made a string of executive appointments since Staggs was named chief operating officer. In May, the company named Leslie Ferraro president of its consumer products division; she took over for Bob Chapek, who was tapped to fill Staggs’ old job as head of the parks and resorts group.

Disney said it would announce a new finance chief at a later date. Rasulo, who became CFO in 2010, will serve as an advisor to Iger after vacating his current position.

Iger and Rasulo were not made available for interviews, but both released statements about the executive’s forthcoming exit. Iger praised Rasulo for being a “valued colleague and friend,” and Rasulo said it was a “true honor” to work at Disney.

According to a Securities and Exchange Commission filing, Rasulo, who earned $16.2 million in fiscal year 2014, had been working at Disney without a contract since his deal there expired Jan. 31.

Until February, Rasulo and Staggs had been locked in a race to succeed Iger, 64, who twice in recent years had extended his contract with Disney. In 2010, Staggs took over the parks division from Rasulo, who slid into the CFO role that had been previously held by Staggs. The job switch was seen as a way for the company to broaden the executives’ experience and to see how they would perform in different roles.

Both Staggs and Rasulo had staunch supporters within Disney, which took care to not let the race become a messy, public matter. Succession at the company has become a highly managed process since the awkward handoff from former Chief Executive Michael Eisner to Iger in 2005.

Although Disney’s recent succession face-off lingered — and will now result in the departure of a key executive — the company avoided the drama of another recent, high-profile Hollywood executive bake-off. At Warner Bros., an ugly battle for the company’s top job became a distracting process before Kevin Tsujihara took over as studio chief in early 2013. Within three months, Tsujihara’s rivals for the position — Jeff Robinov and Bruce Rosenblum — had left the Burbank company.

Credit the relatively smooth process at Disney to Iger, said Peter Whitford, the former president of Disney Stores Worldwide.

“If there was a fight in the early days under Eisner, it used to happen in [the press], but Iger did a lot to stop that,” said Whitford, who left the company in 2003. “It was his choice to make things a little tighter.”

Rasulo, a native of New York, joined Disney nearly 30 years ago after a stint as a manager at Marriott Corp. During his parks and resorts tenure, Disney opened Hong Kong Disneyland and began a significant remodel of the California Adventure theme park in Anaheim.

He was also previously chairman and CEO of Euro Disney and has been credited with revitalizing Disneyland Paris after it opened in 1992 to poor reviews.

He also worked on the $4-billion purchase of Lucasfilm in 2012 and oversaw last year’s acquisition of digital production house Maker Studios.

“He’s definitely an executive who will have choices based on his experience at Disney — not just in the CFO role, but in the parks role, and his international background,” said Whitford. “He has highly desired skills.”

There is a precedent of high-level Disney executives leaving the company when they are passed over for top jobs.

Famously, former Disney studio head Jeffrey Katzenberg departed in 1994 after Eisner did not elevate him to the president post. Katzenberg went on to co-found DreamWorks SKG.

Robin Diedrich, an analyst for Edward Jones Research, said it would be a surprise if Disney brought in an outsider to be CFO. With the notable exception of Eisner and the hiring of talent agent Michael Ovitz as president in 1995, Disney usually promotes from within for its top jobs.

The announcement of Disney’s next CFO could come in about a month, according to a person with knowledge of the matter who was not authorized to speak publicly.

Disney watchers said that longtime company executive Kevin Mayer could be considered for the job, among other candidates at the company.

Mayer, who is executive vice president of corporate strategy and business development, has overseen several of the company’s notable acquisitions, including those of Lucasfilm and Maker.

Staggs is now the internal front-runner to become the next CEO of Disney, a sprawling company that has 180,000 employees and is valued at more than $185 billion on Wall Street. Disney has previously used the No. 2 position to prepare incoming CEOs — Iger held the job from 2000 to 2005.

However, Staggs’ elevation to chief executive is not preordained: Between now and 2018, his leadership will be scrutinized by Disney’s board of directors, which will select the company’s next leader.

It’s also possible that Disney could eye an outsider for the CEO position.

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Twitter: @danielnmiller

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