CBS Corp.’s CEO Les Moonves has been linked with a buy-out of the US broadcaster, a move that could head off a potential merger with Viacom.
CBS and Viacom are both owned by 91-year-old Sumner Redstone and his National Amusement Inc. vehicle. The New York Post reported Moonves wants to take control of that shareholding.
Viacom’s president and CEO, Philippe Dauman, is expected to succeed Redstone when he passes away or retires. This has led to widespread speculation he will merge Viacom, which operates channels such as Nickelodeon and Comedy Central, with CBS, the US’s leading broadcast network by ratings, and significantly reduce Moonves’ standing on the US media scene.
Both executives recently re-upped their contracts to remain in their current posts until towards the end of the decade. Moonves’ new deal gives him the option to launch a CBS-backed production company should he choose to exit the network in 2019.
Though Viacom was originally a division of CBS, it bought its parent in 1999 before a 2005 split led to the creation of the current set-up, in which CBS and Viacom are separately operating entities with the same parent company.
NYP sources said Moonves has been talking to Wall Street financiers, including banks and private equity firms, about a buy-out that would free up CBS to go it alone.
However, it was unclear how advanced the discussions were, and the Post added other options were also being discussed. Furthermore, the publication reported Dauman is on National Amusement’s board, meaning he would need to sanction a sell-off and representing a significant obstacle in Moonves’ path.
Meanwhile, although Moonves has grown CBS at more than double the rate of Viacom since the de-merger a decade ago, industry sources have consistently claimed Dauman is Redstone’s preferred successor.
Redstone owns 80% of National Amusement. The Post projected Moonves would need to raise US$2.2 billion to buy him out.