CBS CEO Les Moonves reportedly has more reasons for resisting a Viacom remerger than what has been made public in the company’s battle with majority owner National Amusements.
CBS has pointed toward stock fluctuations endured by the company each time a Viacom remerger has been proposed—both this year and in 2016. CBS has ultimately decided that recombining with Viacom is not in the best interest of its shareholders. According to the Hollywood Reporter, there may be more to that decision.
Moonves reportedly doesn’t want CBS to be weighed down by Viacom channels including MTV and Comedy Central. He said the networks are an “albatross” and worried that CBS might have to bundle them into future carriage deals with operators.
CBS reportedly is interested in bringing on more content for its OTT services CBS All Access and Showtime but could go after cheaper options than Viacom. During negotiations in April, CBS proposed a deal valuing Viacom at $11.9 billion. Viacom’s counter raised the valuation to $14.7 billion.
Another of Moonves’s reported issues, one that’s been mentioned before, is Viacom CEO Bob Bakish’s role in the combined company. National Amusements’ Shari Redstone initially wanted Bakish to take on an executive role in the combined company but later backed down somewhat and asked that Bakish be on the board of the combined company.
Moonves reportedly scoffed at both, not wanting Bakish to be positioned as his heir apparent and not wanting another Redstone supporter on the CBS board.
The core component of the battle between CBS and NAI is NAI’s recently issued CBS bylaw changes that require a super majority (or 90% board approval) to pass measures like the CBS-proposed dividend which would dilute NAI’s voting shares from 80% to about 20%.
Since Shari Redstone and two other CBS board members—Robert Klieger and David Andelman—are all affiliated with NAI, a super majority of the total 14 board members would be difficult to reach.