CBS Submits Initial Bid for Viacom at Price Below Market Value

Apparently CBS has made an offer to acquire Viacom and the bid is contingent on its management team being at the helm of the merged entity. The all-stock offer is below Viacom’s current market valuation of $12.5 billion. In its offer, CBS proposed that Chief Executive Leslie Moonves and President Joe Ianniello would run the combined company for the foreseeable future, which could make Viacom CEO Bob Bakish an odd man out. Both CBS and Viacom are controlled by media mogul Sumner Redstone’s holding company National Amusements, which has a nearly 80% voting stake in each firm. Shari Redstone, Mr. Redstone’s daughter and the president of National Amusements, is a vice chair of both both CBS and Viacom and has been pushing for the two companies to recombine. CBS’s proposal could be the beginning of a negotiation, if Viacom rebuffs the offer and pushes for better terms. Viacom originally acquired CBS in 2000 and spun it off in 2006. In recent years, CBS has outperformed Viacom, whose cable networks and movie studio Paramount Pictures has struggled.