The halves and the have-knots

Industry feeling repercussions of Viacom split

First Brad and Jen. Now Viacom?

America wept for the couple’s parting, but Wall Street is euphoric over Sumner Redstone‘s conglom going splitsville.

Like any breakup, there are pros and cons. Especially when the plan to split the company in two, unveiled March 16, all but admits that, oops, we really didn’t need to do that CBS deal.

The split means MTV Networks and Paramount can wave goodbye to Infinity’s moribund radio and billboard biz, and pursue sexy acquisitions (Lions Gate?) using high-flying new stock.

As a CEO, Tom Freston may worry less about pursuing big deals than he does as a co-chief-operating officer vying with Leslie Moonves for the top job. After all, an unsuccessful acquisition could have scuttled his chances.

Now it looks like Tom and Les will both be CEOs — albeit of miniaturized empires — neatly solving Viacom’s succession issue, at least for now.

On the downside, Par will be losing a deep- pocketed parent just as the studio ramps up spending and seeks to boost its profile in Hollywood. That means a flop on the film side could really shake the house.

Some investors also worry about MTV Networks becoming estranged from CBS, which will join Infinity in a separate public company headed by Moonves.

That’s because of so-called retransmission consent. The cable networks — negotiating carriage deals with cable operators — had a powerful negotiating tool in the CBS local stations.

Other Wall Streeters are confident Viacom will strike longterm deals to protect the few (very few, it turns out) areas of synergy that actually existed in the merged company.

Merrill Lynch’s Jessica Reif Cohen figures MTV will continue to negotiate retransmission rights for CBS; that Paramount TV will keep distributing Par pics in international TV markets; and that Paramount Film will continue to distribute Par TV’s DVDs.

Viacom chairman-CEO Redstone tells Variety he doesn’t regret that $36 billion, all-stock merger with CBS five years ago. The deal he struck with ousted chief operating officer Mel Karmazin launched several years of madcap mergers.

Vivendi Universal split. Time Warner’s still married to AOL, but has relegated the netco to the naughty seat in the corner and is contemplating a spinoff of its cable unit.

Deals done. Deals undone. It’s a wild ride for investors and employees — but at least it keeps the bankers in business.

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