For what feels like an eternity, CBS and Viacom have been circling a merger that would undo their formal split from 2006. Now it looks like it may finally happen.
The Wall Street Journal reports that CBS and Viacom are in the final stages of the merger negotiation and that the companies are hoping to announce a deal as early as today. The companies are still working out details regarding the exchange ratio for the all-stock transaction.
Reports from last month suggested the companies were hoping to announce a deal in early August to coincide with both companies’ quarterly results, which were announced last week.
Bloomberg cited people familiar with the matter who said the companies worked into the night on Sunday to reach an agreement on the details. National Amusements’ Shari Redstone will reportedly serve as the chairman for the combined companies, and current Viacom CEO Bob Bakish will move into the chief executive role for the combined CBS and Viacom.
According to Variety, the deal will reportedly value Viacom at approximately $13 billion.
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If CBS and Viacom complete the remerger, there’s a possibility that Redstone will begin pursuing other potential M&A to better compete with recently bulked up competitors including Disney and WarnerMedia. According to NBC News, Redstone has mentioned Sony Pictures and Discovery Inc. as two potential M&A targets.
But the first hurdle is completing the CBS-Viacom deal, which has been on and off and on again for years now. CBS and Viacom’s previous remerger talks in 2018 dissolved into a bitter feud as CBS sought to dilute majority shareholder National Amusements' voting power within the company. CBS accused NAI’s Shari Redstone of interfering with the CBS board nomination process, of acting to undermine CBS’ “highly lauded and successful management team in a series of escalating attacks,” and of blocking another unnamed acquisition partner from pursuing a deal with CBS.
The legal dispute was settled in September 2018, and Chairman and CEO Les Moonves left the company after several accusations of sexual misconduct were leveled against the longtime CBS executive.
Prior to that, CBS and Viacom had explored a remerger in 2016, which was eventually called off.