CBS Corp and Viacom have reached a deal to reunite, betting that a larger company will be able to compete and partner better in a media industry dominated by giants, Reuters reports.
The new company will be named ViacomCBS Inc, although CBS shareholders will own 61 percent and Viacom shareholders will own 39 percent, the report said.
The merger will combine the CBS television network, CBS News, Showtime cable networks with MTV Networks, Nickelodeon, Comedy Central and the Paramount movie studios.
Together, they will own more than 140,000 TV episodes and 3,600 film titles. Annually, it is estimated to generate about US$28 billion in revenue.
It creates a company with roughly a US$30 billion market value.
The merging companies are controlled by National Amusements, the holding company owned by billionaire Sumner Redstone and his daughter, Shari.
“My father once said ‘content is king,’ and never has that been more true than today,” Shari Redstone was quoted as saying in a statement.
The third attempt at a merger since 2016 is a decisive win for Shari Redstone, whose father built the companies through a series of mergers and then broke them apart 13 years ago.
Previous merger talks had failed because of clashes between executives over divvying up top jobs and the companies’ relative valuation.
The recombination comes amid an increasingly competitive media landscape dominated by Disney and Netflix, prompting Redstone to pursue a merger.
Viacom Chief Executive Bob Bakish will be the president and CEO of the combined company.
Bakish in an interview said that he will compete with Netflix, Disney and AT&T for subscribers and also create and sell TV shows and movies to other companies, an operation that will grow thanks to the new deal.
The companies said they expect about US$500 million in annual cost savings.
– Contact us at [email protected]