CBS is preparing to make an initial marriage proposal to Viacom over the next few days, several months after the two companies formed a special committee to explore a deal—and 12 years after they filed for divorce.
The proposal from CBS’ independent board committee to its counterpart at Viacom is likely to include an opening sally on price as well as leadership plans for the combined entity, according to a report in Blooomberg that cited people with knowledge of the matter.
These people said CBS will propose that its highly regarded chairman-CEO Leslie Moonves lead the combined company.
The timing of the proposal is fluid and details won’t be released publicly, they said. Both sides hope to clinch a deal before reporting financial results in May but there’s no guarantee.
A representative for CBS declined to comment. A Viacom spokesman was not immediately available to comment.
A merger has been under consideration for some time. Initial talks broke off over a year ago but were renewed by Shari Redstone, daughter of Sumner Redstone, who is the controlling shareholder of both companies. A recent wave of consolidation in the media and entertainment industry—including Walt Disney’s $52-billion play for 21st Century Fox and the proposed $85-billion merger of AT&T and Time Warner—as well as rapidly changing landscape in viewing habits and technology have ratcheted up pressure on smaller players to bulk up.
The Redstones’ holding company. National Amusements, owns 80% percent of the voting stock of both groups. Beyond a CEO, the two committees need to identify a second in command, a board for the merged entity, and its degree of independence from its controlling shareholder.
As of Friday, CBS had a market cap of $19.7 billion and Viacom of $13 billion. In early trading Friday, CBS was down 0.94% to $51.39. Viacom was up 1.8% at $39.60