Published: Tue, May 15, 2018
Business | By Kate Woods

CBS sues National Amusements over Viacom remerger fight

CBS sues National Amusements over Viacom remerger fight

National Amusements' Shari Redstone was reportedly pushing for Viacom CEO Bob Bakish to be installed a chief operating officer of the combined company, while CBS CEO Les Moonves reportedly wanted to keep his current COO, Joe Ianniello.

National Amusements said it was "outraged" by the lawsuit and "strongly refutes [CBS'] characterization of recent events".

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'Ms. Redstone has acted to undermine CBS's highly lauded and successful management team in a series of escalating attacks, including by talking to potential CEO replacements without Board approval and deriding executives, ' declares another. "These escalating attacks make it hard for management to perform its duties and threatens continuity of management", the filing states. The company said in the suit against National Amusements, which also names Shari Redstone and her father, Sumner Redstone, as defendants, that the proposed deal with Viacom "is not in the best interests of CBS". The dividend would not dilute CBS stockholders holdings.

"The Special Committee has taken this step because it believes it is in the best interests of all CBS stockholders, is necessary to protect stockholders' interests and would unlock significant stockholder value". "CBS's stock price has dropped from almost $70 per share to almost $50 per share since merger talks were reinstated-a loss of approximately $7 billion in market cap suffered by the Class B stockholders".

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The dividend would not dilute the economic interests of any CBS stockholder, but would help the company to operate as an independent, non-controlled company and fully evaluate strategic alternatives, the company said. On Monday, CBS filed a lawsuit against National Amusements and its president, Shari Redstone, to block it from forcing the merger.

The company is seeking a temporary restraining order "to prevent Ms. Redstone and National Amusements from attempting to replace the board or modify the company's governance documents before any board action taken at the special board meeting becomes effective".

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