Jan 3 (Reuters) - Activist hedge fund Blackwells Capital will nominate three directors at Walt Disney Co, rivaling Trian Fund Management which is seeking two seats on the entertainment giant's board, people familiar with the matter said.

While board challenges typically represent attempts to change a company's strategy, Blackwells is supportive of Disney CEO Bob Iger's work, the sources said.

Blackwells is offering a choice of nominees to Disney shareholders who agree that new blood on the board could help Iger but object to electing Trian's nominees, who are critical of the company's strategy, the sources added.

The unusual twist in the battle for Disney's board underscores the high stakes in the company's attempted turnaround under Iger. He led Disney from 2005 to 2020 and returned as CEO in November 2022, after investors punished the company's stock for a $1.5 billion quarterly loss in its streaming division, more than double the year-ago loss, and many of its movie franchises underperformed.

Blackwells will nominate three executives with entertainment, real estate and venture capital experience to Disney's board, the sources said.

These include Jessica Schell, a former Warner Brothers executive with expertise in content distribution; Tribeca Film Festival co-founder Craig Hatkoff; and Leah Solivan, who founded and headed TaskRabbit, the sources added.

Blackwells is also proposing to allow incumbent board directors who lose their seats to Blackwells nominees to be reinstated through a board expansion, the sources said.

The sources requested anonymity because the nominations were private. Disney and Trian did not immediately respond to requests for comment.

Earlier on Wednesday, Disney said it reached a deal with another hedge fund, ValueAct Capital, to advise it on strategy and support its director nominees at its annual shareholder meeting.

Blackwells had called on Trian in November to drop its board challenge against Disney. Blackwells owns only about $5 million worth of Disney shares, compared with $3 billion worth of Disney stock controlled by Trian.

Trian has put forward its CEO Nelson Peltz and former Disney Chief Financial Officer James Rasulo as nominees. It has received the endorsement of another Disney investor, activist hedge fund Ancora Holdings.

Blackwells has also asked Disney to investigate Trian's relationship with Ancora and other shareholders, the sources said.

Disney took steps to refresh its board in November, adding former Morgan Stanley CEO James Gorman and former SKY CEO Jeremy Darroch to its ranks. The board has been criticized by Trian and other investors for botching Iger's succession. His hand-picked replacement, Bob Chapek, resigned in 2022 as Disney's problems mounted, and Iger has now said he believes he will have a new successor in place by 2026.

Following his return, Iger has embarked on a restructuring to cut costs. The company has told investors it is on track to achieve about $7.5 billion in cost savings – $2 billion more than its original target.

Led by Jason Aintabi, Blackwells has previously had success in calling for the ouster of CEOs at Peloton Interactive and Colony Capital, which became DigitalBridge. It also plans to challenge the board of fast-food restaurant chain Wendy's Co, in which Trian owns a 16% stake and has three board representatives. (Reporting by Svea Herbst-Bayliss in Boston; Editing by Greg Roumeliotis and Richard Chang)