Redstone Family Seeks Viacom, CBS Combination29 Sep, 2016 By: Erik Gruenwedel
Deal would put Paramount Home Media Distribution and CBS Home Entertainment under same corporate roof
As expected, National Amusements Inc., the privately held media company controlled by Sumner Redstone and his daughter Shari Redstone, Sept. 29 formally asked the boards of CBS and Viacom to merge the two companies in an all-stock transaction. National Amusements is the majority shareholder of CBS and Viacom, the latter including Paramount Pictures, Nickelodeon, MTV, Comedy Central, B.E.T., among others.
“We believe that a combination of CBS and Viacom might offer substantial synergies that would allow the combined company to respond even more aggressively and effectively to the challenges of the changing entertainment and media landscape,” the Redstones said in a letter to each company’s board.
The executives said any merger would be dependent upon the approval of each company’s board, with Sumner, Shari and David Andelman abstaining from voting or participating in any related deliberations.
“We believe moving forward expeditiously, but with due care, is important and we are prepared to be of assistance to the two companies as they explore this possibility,” read the letter.
The proposal comes 10 years after CBS and Viacom split into separate public companies with Les Moonves and Philippe Dauman named CEOs of each company, respectively.
Dauman, who earlier this year was named executive chairman of Viacom, has tried selling a minority stake in struggling Paramount, which includes Paramount Home Media Distribution. That contributed to an ensuing power struggle at Viacom between Dauman and Shari Redstone, who was backed by her 93-year-old father.
The dispute was settled in August with Dauman departing and COO Thomas Dooley named acting CEO. Dooley recently announced he would be leaving in November.
Industry watchers speculate that Moonves would become CEO of a combined company, a move Moonves reportedly has indicated little interest in.
Indeed, at an investor group presentation earlier this month, Moonves said CBS wasn’t engaged in any merger discussions, and said the company remained focused on expanding distribution of content among emerging channels.
“We are not in active discussions for anything like that,” Moonves said at the Bank of America Merrill Lynch Media, Communications and Entertainment investor confab in Los Angeles. “We are very happy with the position we are playing now. We think we have a great future as the CBS Corporation now.”