Please wait...
Please wait...

CBS readies Viacom bid

CBS Corp will offer less than the market value of fellow US media giant Viacom in its opening salvo to re-merge with the company, with a proposal expected this week.

Les Moonves

Les Moonves

The initial proposal will see CBS make an all-share offer for the MTV and Nickelodeon operator, with the Eye’s CEO Les Moonves set to head the merged entity should the deal be completed. The proposed future of Viacom president and CEO Bob Bakish has not been made clear.

Both CBS and Viacom are controlled by billionaire Sumner Redstone and his family. Viacom bought Showtime owner CBS in 2000, only for the two companies to split six years later. Since then, CBS has enjoyed growth while Viacom has struggled to expand as planned.

A potential re-merger has been considered by both companies for several years but the likelihood of a deal increased earlier this year when CBS and Viacom formed special committees to evaluate a potential deal.

The merger would see CBS’s television network combined with Viacom cable channels such as Comedy Central, as well as its movie studio Paramount Pictures.

Viacom also owns Channel 5 in the UK, Telefe in Argentina and Colors in India, the latter via its partnership with TV18.

However, CBS’s proposed below-market-value offer for Viacom, first reported by Reuters, suggests a deal could be further away than first thought. Viacom is valued at around US$22bn, based on its current share price.

The proposed merger comes as the US media industry faces a period of huge consolidation, with Disney’s US$52bn takeover of major 21st Century Fox assets and AT&T’s US$85bn agreement to buy Time Warner currently facing regulatory scrutiny.

RELATED ARTICLES

Please wait...