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The CBS chief says it's all about shareholder value, but he privately considers the Viacom channels an albatross, thinks there are better deals and considers Bob Bakish a threat.
In an era when Disney is aiming to acquire most of 21st Century Fox for $52.4 billion and AT&T is attempting to merge with Time Warner in an $85 billion deal, scale has become the priority for media titans. Yet, presented with the opportunity to lead a combined CBS-Viacom, Leslie Moonves didn't simply rally the CBS board of directors to support his "no merger" view — he went "nuclear" on National Amusements Inc., the entity run by Sumner and Shari Redstone that holds an 80 percent voting stake in both companies. On May 17, the CBS board voted 11-3 to issue a dividend of shares that would dilute NAI's control to 17 percent — the three "no" votes coming from Shari Redstone and Robert Klieger and David Andelman, two board members who are Redstone family lawyers.
Judge - Moonves - Hail - Mary - Dilution
If a judge approves Moonves' Hail Mary dilution plan — which one person close to the situation likens to "swatting a fly with a sledgehammer" — the executive will have killed a roughly $12.3 billion merger that few on Wall Street seem to be advocating to begin with. Indeed, each time it appears CBS might purchase Viacom, shares of the former drop, and when it seems the acquisition is a long shot, CBS shares rise. But short-term stock movements often are dismissed when negotiating multibillion-dollar mergers, raising the question: What's Moonves really after — or trying to prevent?
Viacom, CBS and NAI declined to comment, but numerous sources close to the situation say the answer is fourfold: First, Moonves has grown weary of playing second fiddle to the Redstones and sees anti-Viacom sentiment as a rare opportunity to...
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