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Viacom Seeks Higher Offer From CBS, President Post for Bob Bakish

Viacom is pushing CBS Corp. to raise its takeover bid for the company, asking for a deal that would add nearly $3 billion to the valuation of the company.

Viacom has asked CBS to raise its all-stock bid to a level that would value the company at around $14.7 billion. Viacom as expected is also pushing for its current CEO to be named president and chief operating officer of the combined company, to be led by CBS’ chairman-CEO Leslie Moonves.

News of Viacom’s counteroffer was first reported early Monday by Reuters. A source close to the situation confirmed Viacom’s counteroffer despite the fact that both Viacom and CBS have yet to publicly acknowledge the statis of acquisition negotiations.

CBS on March 30 made an initial offer for Viacom that included no premium on its current market cap of around $12.5 billion and did not include a role for Bakish. That has been a non-starter for the Viacom camp. CBS views Viacom as fairly valued at its current market cap given the run-up in the stock in recent months on M&A rumors.

CBS’ initial offer proposed a deal that would offer Viacom shareholders 0.55 shares of CBS stock for each share of Viacom Class B stock. Viacom’s counteroffer raises that ratio to of 0.68 CBS shares, according to Reuters.

The gap between the companies’ view of valuation and management underscores the difficulties of bringing the two companies together again. CBS and Viacom are both controlled by Sumner Redstone’s National Amusements.

Shari Redstone, vice chair of CBS and Viacom and president of National Amusements, has prodded the companies back to the altar amid concerns that both need to bulk up in order to remain competitive with larger media and tech conglomerates. Shari Redstone was said to have been frustrated by CBS’ initial offer.

CBS and Viacom declined comment early Monday. The companies were brought together in a merger by Sumner Redstone in 2000 and split up again in 2006.

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