CBS and Viacom, which split in 2006, have agreed to a merger. Both US TV companies are controlled by the Redstone family through its National Amusements holding company. The deal values Viacom at $12bn and the combined entity at $30bn. “My father once said ‘content is king’, and never has that been more true than today” said Shari Redstone, chair of the board of the re-merged ViacomCBS. Viacom CEO Bob Bakish will lead the combined company with total revenues of over $28bn.
CBS began as a small chain of cinemas, invented the multiplex format and expanded into TV when it took over MTV and Nickleodeon owner Viacom in the 1980s. The company supplemented its broadcast network with acquisitions including Paramount Pictures, CBS and Simon & Schuster. It also owns Showtime, Comedy Central, BET, VH1, 28 local TV stations, and a 50% interest (alongside AT&T) in the CW TV network. Variety says the combined portfolio represents 140,000 episodes of TV and 3,600 films.
ViacomCBS is now led by a woman from the Redstone family along with a female dominated board, following years of male domination and accusations of sexual harassment which, among other things, forced the resignation of Les Moonves, longtime CEO – and opponent of Ms Redstone.
It will, however, remain a relatively small player by comparison with the likes of Disney-Fox and AT&T-Time Warner. Further consolidation must be expected if the newly-merged company is to compete globally.
The merger has been a longtime objective of Ms Redstone who has spent more than three years squabbling over it, not least with her ageing father. She now has the challenge of steering the company through tumultuous times for the moving pictures business. The FT noted this week: “Analysts warn that merging CBS and Viacom may not be enough to convince investors she is the right person to lead the group in the battles ahead. Despite what Shari accomplishes near-term by getting these two companies back together, her family’s name will not be associated with excellence in shareholder returns” referring to her father’s 2006 decision to separate the companies in the first place, and the lagging performance of Viacom stock in the past decade.
Variety reports rumours that the company could be about to buy Discovery Inc. and/or Lionsgate and also Starz its premium cable network. The fun is, presumably, just beginning
