February 1, 2018
CBS Feb. 1 announced that its board has established a special committee of independent directors to evaluate a potential merger with Viacom, which includes Paramount Pictures.
CBS said that despite forming a special committee there is no assurance that it would result in a transaction or on what terms any transaction might occur.
CBS and Viacom were previously legally together until 2006, when Sumner Redstone, founder and controlling shareholder of Viacom, declared that diversified media conglomerates were dinosaurs due to changing market conditions.
Fast-forward to the present and 94-year-old Redstone is still around – with an apparent polar opposite mindset.
His daughter, Shari Redstone, vice chairman of Viacom, is driving reconnecting with CBS, which is headed by Les Moonves. The rationale being that diversified consolidation is mandatory in an increasingly fragmented direct-to-consumer market.
CBS and Viacom are following M&A leads taken by AT&T and Time Warner, and Walt Disney and 20th Century Fox.