Viacom will name Shari Redstone vice chair
NEW YORK — Shari Redstone is expected to be named vice chair of Viacom at a crucial board meeting next week, capping several years in which she’s stepped up her presence in and around the media conglom’s executive suite.
At that meeting, Viacom’s directors are set to vote in favor of a plan to split the company in two, unwinding the 5-year-old Viacom-CBS merger.
Viacom chairman-CEO Sumner Redstone has said the board will vote on the split by the end of June and that he is “personally committed” to the move. But Viacom hasn’t disclosed a date for the meeting and it’s unclear whether another meet would be needed before a formal announcement.
The vice-chair role would give Shari Redstone, who’s 50 and head of the family’s privately held movie theater chain National Amusements, a formal platform from which to survey Viacom’s various businesses, participate in planning and assume a more public role as a face of the company at a time of radical change.
Post-split, Leslie Moonves will run the so-called value company, led by CBS. Tom Freston will head the so-called growth company, topped by MTV Networks and Paramount.
Sumner Redstone, 82, will remain chairman and controlling shareholder of each — a role his daughter will eventually inherit.
Although rumors have circulated inside Viacom and on Wall Street that Shari Redstone wasn’t a fan of the split, both she and Sumner Redstone insist that’s not the case.
Wanted more info
“I was never opposed to the transaction. I just wanted more information, and to understand better the ramifications of a potential split. My father and I are in perfect agreement as to what’s in the best interest of Viacom,” Shari Redstone told Daily Variety.
Company said the split is driven by a mix of strategic logic and market considerations as a way to boost Viacom’s sluggish stock.
Sumner Redstone has said the original merger made sense at a time of explosive growth in radio, vibrant advertising, a booming economy and a sizzling stock market.
But times change.
Viacom shares are worth half of what they were five years ago, and they’re down about $4 over the past year. Redstone calls the stock undervalued. The split aims to “unlock” value by separating the slower-growth radio and broadcast TV biz from fast-paced MTV Nets and the more volatile Paramount film studio.
Wall Street generally embraced the idea — with reservations. Some investors say that while the move may “unlock” value, it won’t necessarily create value. They note the high costs of duplicating all corporate functions and figure there must still be some benefits from synergy.
But others are attracted by the opportunity to own what they see as a rare, publicly traded standalone cable network group.
And standing solo, Moonves anticipates many millions accruing to CBS when it starts demanding cash from cable and satellite operators for retransmission consent.