CBS Postpones Annual Shareholder Meeting

CBS canceled its planned May 18 annual shareholder meeting following a week of litigation and drama between the media giant and its majority shareholder National Amusements, which is headed by Shari Redstone and her ailing 94-year-old father Sumner Redstone.

On May 17, the board of directors of CBS voted 11-3 to dilute the voting power of National Amusements from 80% to 20%. That vote was largely for naught since Shari Redstone – before the board vote – changed the company’s bylaws, requiring a supermajority vote to enact changes by the board.

“CBS management and the special committee cannot wish away the reality that CBS has a controlling shareholder [i.e. National Amusements],” Shari Redstone said in a statement. “NAI yesterday exercised its legal right to amend the company’s bylaws to require a supermajority vote on certain board actions with respect to dividends, effective immediately. In light of the Board’s action today, that action was plainly necessary, and it is valid.”

Indeed, a judge from the Delaware Chancery Court May 17 ruled against CBS’ request for a temporary restraining order prohibiting the Redstones from blocking the expected CBS board vote diluting their voting power.

In the rapidly changing media landscape, Shari Redstone is seeking to re-merge CBS and Viacom, with Viacom CEO Bob Bakish assuming the No. 2 position to CBS CEO Les Moonves. The latter reportedly has no real interest in CBS rejoining Viacom, including assets Paramount Pictures, BET, MTV, Nickelodeon and Comedy Central, among others.

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