Red­stone push is on to re­unite CBS and Vi­a­com

Daily Local News (West Chester, PA) - - MARKETPLACE - By Mae An­der­son The As­so­ci­ated Press

Me­dia mogul Sum­ner Red­stone is push­ing for a re­union be­tween CBS and Vi­a­com, more than a decade af­ter they went their sep­a­rate ways.

Na­tional Amuse­ments, which owns most of the vot­ing shares of the two com­pa­nies, sent a let­ter to CBS and Vi­a­com board mem­bers Thurs­day say­ing that a tie-up would help the two com­pa­nies to bet­ter com­pete as tech­nol­ogy and the en­ter­tain­ment in­dus­try rapidly evolve.

Na­tional Amuse­ments is a movie theater op­er­a­tor run by Red­stone, who or­ches­trated the split of CBS and Vi­a­com in 2006.

It was hoped that sep­a­ra­tion would al­low the more prof­itable Vi­a­com, which owns ca­ble chan­nels MTV, Nick­elodeon and VH1, to sprint ahead of the sto­ried but slow-grow­ing CBS.

Those tides have turned as more and more peo­ple cut the ca­ble cord, choos­ing in­stead to stream TV shows or movies on­line at places like Net­flix, Hulu, iTunes and Ama­zon.com.

The suc­cess CBS has had stream­ing its shows, as well as its stand-alone, stream­ing Show­time chan­nel, could be in­valu­able at Vi­a­com, said No­mura an­a­lyst An­thony DiCle­mente. The stream­ing ser­vices could even fall un­der a sin­gle um­brella, DiCle­mente said.

Vi­a­com said it ex­pects its board will form a spe­cial com­mit­tee of in­de­pen­dent di­rec­tors to con­sider the let­ter from par­ent com­pany Na­tional Amuse­ments. CBS said it will eval­u­ate what is in the best in­ter­est of its share­hold­ers.

The let­ter from Na­tional Amuse­ments fol­lows a long run­ning le­gal bat­tle over the fate of Red­stone’s me­dia em­pire be­tween long­time Vi­a­com CEO Phillippe Dau­man and Sum­ner Red­stone’s daugh­ter, Shari. The fight ended with Shari Red­stone as a Vi­a­com di­rec­tor and pres­i­dent of Na­tional Amuse­ments, and Dau­man’s de­par­ture.

Vi­a­com’s in­terim CEO Tom Doo­ley will leave Nov. 15. Some have spec­u­lated that CBS CEO Les Moonves could to take charge if the two com­pa­nies again be­come one, al­though Moonves has said in the past that he doesn’t think a merger is a good idea.

There would be tan­gi­ble fi­nan­cial ben­e­fits to the tie up, how­ever.

The com­pa­nies take from af­fil­i­ates would in­crease, ac­cord­ing to Mof­fet­tNathanson an­a­lyst Michael Nathanson. The com­pa­nies right now de­liver a com­bined 23 per­cent of na­tional view­ers, but are paid only 14 per­cent of af­fil­i­ate fees.

THE AS­SO­CI­ATED PRESS

In this May 2016 file photo, trader Ed­ward Cur­ran, right, works near the post that han­dles CBS Corp. on the floor of the New York Stock Ex­change. On Thurs­day, Na­tional Amuse­ments, the com­pany that con­trols CBS and Vi­a­com, an­nounced it wants the two me­dia com­pa­nies to com­bine again, more than a decade af­ter they went their sep­a­rate ways.

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