Sumner Redstone
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Sumner Redstone’s resignation as chairman of CBS and Viacom sent the stocks of both media companies rising in pre-market trading Thursday although shares settled into more modest gains later in the day.

Shares of CBS closed Wednesday up 4% to $48.26 and were up 3.5% to $49.96 in pre-market trading on Thursday; Viacom’s stock closed 2% higher at $44.67 and were up 5.8% to $47.25 in pre-market trading on Thursday. CBS was up 3.7% to $49.98 as trading began Thursday, while Viacom spiked 5.5% to $47.12.

On an up and down day for the major indexes, CBS hovered between a 2%-3% gain to a slight decline. Viacom shares were up more than 3% but eased off later in the day to a less than 1% gain.

At CBS, Leslie Moonves was named chairman Wednesday and will continue to serve as the company’s president and CEO. Following Moonves’ appointment, Shari Redstone. Sumner’s daughter and a member of the Redstone family trust, released a statement that suggested she does not want to see Viacom CEO Philippe Dauman elevated to the chairman post. Dauman was voted chairman by the Viacom board Thursday morning — with Shari Redstone as the only dissenting vote from the 11-member board.

“It is my firm belief that whoever may succeed my father as chair at each company should be someone who is not a trustee of my father’s trust or otherwise intertwined in Redstone family matters, but rather a leader with an independent voice,” Shari Redstone said in a statement.

Dauman is a member of the family trust. The Viacom chief has been criticized in investment circles for his stewardship of the company. Viacom television properties such as MTV and Nickelodeon have struggled in the ratings and its film studio Paramount has ceded market share while making fewer pictures.

The 92-year old Redstone is known to be in failing health. He is embroiled in a legal case with a former companion, Manuela Herzer, who has criticized the way that his healthcare decisions are being made and raised questions about his mental capacity.

Analysts struggled to make sense of what the shift in leadership will mean for both CBS and Viacom and the broader media landscape.

Todd Juenger at Bernstein Research viewed the changes at CBS positively, but was pessimistic about Viacom’s longterm prospects, writing, “Regardless of who’s running the company, we don’t think anything can be done anymore to fend off inevitable decline of [Viacom’s] key businesses.”

But in a note entitled “change we can believe in,” Michael Nathanson of MoffettNathanson, saw the shift atop Viacom and CBS triggering a new era of mergers and marriages among the companies who control movie studios and television networks.

“Thinking about what this change for CBS and Viacom could mean for the broader media landscape, we believe that changes for the Redstone controlled empires could be the trigger for media company consolidation as each company will be forced to figure out if they are a buyer or seller in the coming months,” he wrote.

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