CBS-Viacom merger may be closer to reality, thanks to Redstones and National Amusements
The oft-foretold reunification of CBS Corp. and Viacom Inc. may be moving closer to reality.
National Amusements Inc., the investment vehicle of media mogul Sumner Redstone, is preparing to call on the two companies to consider merging, two people close to the matter said Wednesday.
National Amusements, which controls 80% of the voting shares of Viacom and CBS, is preparing a letter to send to the two companies’ boards in the coming days, according to the two people, who declined to be named because the proposal is private.
Viacom, which owns cable channels such as MTV and Comedy Central as well as Paramount Pictures, is expected to form a special committee to review a possible merger. CBS has not yet convened such a committee.
Viacom’s shares rose 2% to $36.20 in midsession trading on Wall Street after Reuters first reported the potential letter. CBS’ stock rose 1.5% to $52.85.
Representatives for Viacom, CBS and National Amusements declined to comment.
The development comes shortly after a major shake-up in Viacom’s executive ranks. Viacom’s interim chief executive, Thomas announced last week that he would leave the company Nov. 15. Two days later, Rob Moore, vice chairman of Viacom’s struggling film studio, was ousted from his position.
A combination of CBS and Viacom would reunite two companies that were separated in 2006. Many analysts have said that a merger would be the ultimate goal of Redstone’s daughter Shari Redstone, who has risen in power amid an intense battle for control of her 93-year-old father’s $40-billion media empire.
That fight saw the ouster of Chief Executive Philippe Dauman, who presided over years of struggles at Viacom.
Shari Redstone has a strong relationship with CBS Chief Executive Leslie Moonves, who is widely respected as one of the most savvy programmers in Hollywood. Should CBS take over Viacom, Moonves probably would run the combined operation.
However, Moonves said at a recent investor conference that there were no direct discussions underway between the two companies regarding a merger.
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