WASHINGTON (dpa-AFX) - National Amusements Inc., the owner of a majority of CBS Corp. (CBS-A, CBS) and ViacomInc.'s (VIAB, VIA) voting stock, said Monday that it has asked the Boards of CBS and Viacom to discontinue their exploration of a potential combination.



Sumner Redstone and his daughter Shari Redstone's National Amusement said that after reviewing a tie-up 'we have concluded that this is not the right time to merge the companies.'



VIA is currently trading at $39.65, down $2.80 or 6.60 percent. CBS-A is trading at $61.62, down $1.60 or 2.53 percent.



In late September, National Amusements said it believed a merger could 'allow the combined company to respond even more aggressively and effectively to the challenges of the changing entertainment and media landscape.'



In the statement Monday, National Amusements called for a focus on the companies' 'independent paths forward.'



The Redstone firm said it is encouraged that the companies can thrive separately, citing new Viacom Acting Chief Executive Bob Bakish's 'forward-looking thinking and strategic plan' and confidence that Les Moonves, chief of CBS, could continue to deliver strong results there.



Copyright RTT News/dpa-AFX </s> Shares of Viacom tumbled 6.8 percent in early New York Stock Exchange trading to $36. CBS shares were down 3 percent at $60.69.

"Following the management changes that the Viacom Board put in place, we have been very impressed with the forward-looking thinking and strategic plan being pursued under Bob Bakish’s leadership," National Amusements said in a letter to both boards.

The letter also said "CBS continues to perform exceptionally well under Les Moonves," the company's longtime CEO.

One major sticking point in negotiations was that Moonves wanted autonomy over the merged company, as Reuters reported in October.

National Amusements was willing to compromise on this issue, but in the end decided it liked the direction Bakish was taking the company, according to a source familiar with the situation who wished to remain anonymous because they were not authorized to speak publicly.

National Amusements believes Viacom is undervalued and that Bakish can help turn it around, according to two other sources familiar with the situation.

However, it does not mean that a combination between the two companies is off the table forever, said one of the sources.

Shari Redstone and her father, 93-year-old Sumner Redstone, control 80 percent of CBS and Viacom voting shares through their National Amusements Inc movie theater company.

In September, National Amusements called on Viacom and CBS to consider recombining, 10 years after first separating.

CBS and Viacom did not immediately have a comment on the news, which was first reported by CNBC. </s> NEW YORK (AP) — Media mogul Sumner Redstone’s National Amusements is abandoning a proposal that CBS and Viacom reunite after a 10 year split.

National Amusements, which owns most of the voting shares of the two companies, urged the companies to combine in September.

Now, the company says that following management changes at Viacom and strength at CBS, which operates CBS, Showtime and other entities, under Les Moonves it makes more sense for the companies to continue as separate entities. Viacom, which owns cable channels MTV, Nickelodeon and VH1, named Robert Bakish as acting president in late October.

National Amusements is a movie theater operator run by Redstone, who orchestrated the split of CBS and Viacom in 2006, and his daughter Shari Redstone. </s> Viacom stock dropped Monday morning after Shari Redstone called off a months-long exploration of a CBS-Viacom merger.

CBS stock was flat in pre-market trading. Viacom stock fell about 5 percent. The market moves came after CNBC reported that National Amusements, the controlling shareholder of both companies, has called off the merger talks.

Two sources with direct knowledge of the matter confirmed to CNNMoney that National Amusements sent a letter to the boards of CBS and Viacom asking the two boards to stop exploring a combination.

It will be released publicly Monday morning, one of the sources said.

Shari Redstone, the daughter of National Amusements chairman Sumner Redstone, squeezed longtime Viacom CEO Philippe Dauman out of the company over the summer.

Then the Redstones sent a letter to both Viacom and CBS in September asking them to consider a merger.

Since then, Shari Redstone has gained more confidence in the leadership of Viacom, one of the sources said. Bob Bakish was named the interim CEO of the company at the end of October. </s> Viacom and CBS stock dropped Monday morning after Shari Redstone called off a months-long exploration of a merger between the two companies.

The market moves came after CNBC reported that National Amusements, the controlling shareholder of both media giants, had put an end to the merger talks.

National Amusements subsequently released the letter it sent to the CBS and Viacom boards.

"We have concluded that this is not the right time to merge the companies," the letter said. "Following the management changes that the Viacom board put in place, we have been very impressed with the forward-looking thinking and strategic plan being pursued under Bob Bakish's leadership. We know Viacom has tremendous assets that are currently undervalued, and we are confident that with this new strong management team, the value of these assets can be unleashed."

"At the same time," the letter said, "CBS continues to perform exceptionally well under Les Moonves, and we have every reason to believe that momentum will continue on a stand-alone basis."

So the merger talks -- which were not exactly embraced by Moonves in the first place -- are now over.

The move comes at the end of a roller coaster year for Viacom, which has been underperforming other media companies at a time of massive industry-wide change.

Shari Redstone, the daughter of National Amusements chairman Sumner Redstone, squeezed longtime Viacom CEO Philippe Dauman out of the company over the summer.

Then the Redstones sent a letter to both Viacom and CBS in September asking them to consider a merger.

Since then, Shari Redstone has gained more confidence in the leadership of Viacom, two sources told CNNMoney. Bakish was named the interim CEO at the end of October. </s> NEW YORK (Reuters) - Media mogul Sumner Redstone and his daughter Shari called off their failed effort to merge CBS Corp (CBS.N) and Viacom Inc (VIAB.O) on Monday, sending shares of Viacom - widely viewed as the weaker company - down almost 8 percent.

The collapse of the plan, which never got beyond initial talks, raises questions about the future of both Redstone-controlled companies just as scale becomes more important in a media industry set to be reshaped by AT&T;’s (T.N) deal to buy Time Warner Inc TWX.N.

The end of negotiations was not a complete surprise. Les Moonves, the longtime chief executive of CBS, said last week talks were still stuck in the early stages, more than two months after the Redstones asked the boards of both companies to explore a tie-up.

The two sides never entered talks on pricing and were far apart on Viacom’s value, according to two sources familiar with the situation.

Shares of Viacom were down 7.9 percent at $39.10 in afternoon trading.

CBS shares initially rose 1.8 percent, touching a nearly 2-1/2 year high, after CNBC cited a New York Post report that Verizon Communications Inc (VZ.N) was interested in buying the company. Verizon declined to comment.

In afternoon trading, CBS shares were down 0.4 percent at $62.12.

STILL NEEDS FIXING

National Amusements, the privately held movie company through which Shari Redstone and her 93-year-old father control 80 percent of the voting shares of CBS and Viacom, said in a letter they stopped pushing for a deal on the expectation of a turnaround at Viacom under new leadership.

Viacom named Bob Bakish, head of its international business, acting chief executive officer at the end of October, and made that position permanent on Monday afternoon as it announced the end of merger explorations.

A woman exits the Viacom Inc. headquarters in New York April 30, 2013. REUTERS/Lucas Jackson/File Photo

Viacom, which owns Nickelodeon, Comedy Central and MTV, has been struggling to turn around declining ad revenue and ratings while CBS is home to top-rated shows such “The Big Bang Theory” and “Thursday Night Football.”

Mario Gabelli, whose firm is the second-largest owner of voting shares of Viacom and CBS, said he was not disappointed with the failure of merger plans and that he still believes that ultimately the two might merge.

“Viacom needs to be fixed,” he said.

One sticking point in negotiations was that CBS’s Moonves wanted autonomy over the merged company.

National Amusements was willing to compromise on this issue, but in the end decided to let Bakish retain control of Viacom, according to the sources, who wished to remain anonymous because they were not authorized to speak publicly.

Bakish already has started taking action after just a few weeks as acting CEO. Last month, the company announced it was buying Argentine broadcaster Television Federal SA from telecom carrier Telefonica SA for $345 million.

He is also looking to improve relations with affiliates and is working on a plan to turn around MTV, a top priority for him, he told Reuters in November. Last week, he replaced Viacom’s head of distribution, Denise Denson, a longtime executive who worked closely with former CEO Philippe Dauman.

A DECADE APART

In September, National Amusements called on Viacom and CBS to consider recombining, 10 years after Viacom was spun off from CBS. Shari Redstone had been in favor of recombining the two under Moonves, sources have previously told Reuters.

Industry speculation that the two might rejoin increased this year after the Redstones prevailed in a power struggle that resulted in Dauman’s departure.

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A Viacom spokesman confirmed it had received the letter from National Amusements, which was first reported by CNBC. A CBS spokesman declined to comment.

National Amusement’s letter also said: “CBS continues to perform exceptionally well under Les Moonves.”

Relations between Moonves and Shari Redstone continue to be good, the source said. This week, the two plan to go to Boston for the premiere of the film “Patriots Day,” produced by CBS Films. </s> (Reuters) – Leslie Moonves, the top executive at CBS Corp since 2006 and a major figure at the broadcast network and media company for more than two decades, resigned yesterday amid a new wave of allegations against him of sexual assault and harassment.

His departure as chairman, CEO and president was confirmed by the company in a statement coinciding with its announcement of a deal to end litigation against majority CBS shareholder Shari Redstone and National Amusements Inc for control of CBS.

Chief Operating Officer Joe Ianiello will take over as interim CEO as the board searches for a replacement, according to the announcement. The settlements end years of uncertainty over the future of CBS and could potentially open the door to future deals.

The announcement came after six more women accused Moonves of sexual assault and harassment in a report published on Sunday in the New Yorker magazine. The newly disclosed incidents, which the women said occurred between the 1980s and early 2000s, included claims of forced sex, Moonves exposing himself and his alleged use of physical violence and intimidation.

Moonves, who turned CBS from an aging radio and TV broadcaster into a successful provider of shows to digital platforms, was expected to reap an estimated $100 million in severance. But Moonves, 68, could end up with nothing pending an investigation into the allegations of violence against women conducted by law firms hired by an independent committee of the CBS board of directors.

CBS said it and Moonves will donate $20 million of Moonves’ severance to organizations supporting the #MeToo movement.

“Today’s resolution will benefit all shareholders, allowing us to focus on the business of running CBS – and transforming it for the future,” Redstone said in a statement. “We are confident in Joe’s ability to serve as acting CEO and delighted to welcome our new directors, who bring valuable and diverse expertise and a strong commitment to corporate governance.”

National Amusements agreed to avoid pressing for a merger of CBS and Viacom, which is also controlled by National Amusements, for at least two years.

In earlier court filings, NAI had dropped support for a deal before it was sued in May by CBS for control of the company. The settlement does not preclude other parties from suggesting a merger or bringing other potential transactions to the board, one source said.

Five current independent directors and one National Amusement-affiliated director have stepped down from the board of directors and six new directors have been elected, the company said.

Three of the new board members are women, each considered a trailblazer in their respective fields, bringing the total to six on the 13-member board. They are: Candace Beinecke, a senior partner at international law firm Hughes Hubbard & Reed; Barbara Byrne, a retired vice chairman of investment banking at Barclays, and Susan Schuman, CEO of SYPartners, a business consultancy.

Also were to the board were: Richard Parsons, former chairman of Citigroup and Time Warner; Brian Goldner, CEO of Hasbro; and Strauss Zelnick, CEO of Take-Two Interactive.

CBS said the board will schedule its annual shareholders meeting no later than Nov. 30.

Reports of a potential big payout to Moonves drew fire from advocacy groups.

“CBS, as you sit in a room debating next steps to rectify the damage done, remember that the world is watching. We will accept nothing less than full transparency of the investigation’s findings, a commitment to real change across all levels of CBS management and no reward for Les Moonves,” Time’s Up, a campaign against workplace sexual misconduct, said in a statement.

CBS said details of the litigation settlement and the Moonves agreement will be disclosed in an upcoming regulatory filing.

Moonves could not immediately be reached to comment on Sunday after the latest claims. In a statement to the New Yorker, Moonves acknowledged three of the newly described encounters, but said they were consensual.

“The appalling accusations in this article are untrue,” Moonves told the New Yorker. “What is true is that I had consensual relations with three of the women some 25 years ago before I came to CBS. And I have never used my position to hinder the advancement or careers of women.”

CBS said on Sunday it takes such allegations very seriously.

“The CBS Board of Directors is committed to a thorough and independent investigation of the allegations, and that investigation is actively underway,” the media company’s board said in a statement. </s> ATLANTA (AP) — Media mogul Sumner Redstone’s National Amusements is abandoning a proposal that CBS and Viacom reunite after a 10 year split.

The news comes as Viacom named acting CEO Bob Bakish as its permanent head.

National Amusements, which owns most of the voting shares of the two companies, had urged the companies to combine in September, saying that a tie-up would help them compete better as technology and the entertainment industry rapidly evolve.

Now, the company, run by Redstone and his daughter Shari, says that following management changes at Viacom and strength at CBS, which operates CBS, Showtime and other entities, it makes more sense for the companies to continue as separate entities.

Viacom, which owns the Paramount Pictures movie studio and pay TV channels such as Comedy Central, MTV, BET and others, has been struggling to improve its profit as Paramount has struggled to produce hits and cable viewership declines.

The company named Robert Bakish as acting president in late October and appointed him permanent president and CEO on Monday.

The appointment caps off a management saga that culminated earlier this year, when longtime Viacom CEO Phillipe Dauman was pushed out following a legal battle with media mogul Sumner Redstone’s daughter, Shari Redstone, over control of the company. The fight ended with Shari Redstone as a Viacom director and president of National Amusements, which has a controlling stake in CBS and Viacom. At the time Tom Dooley was named interim CEO, but he announced unexpectedly he was leaving in October and Bakish was then named acting CEO.

Meanwhile, as more people cut the cable cord, choosing instead to stream TV shows or movies online at places like Netflix, Hulu, iTunes and Amazon.com, CBS has found success under Les Moonves streaming its popular shows like “NCIS” and “The Big Bang Theory,” as well as its stand-alone, streaming Showtime channel.

There would have been cost savings if the companies combined, but strategically, the positives weren’t as clear, said Instinet analyst Anthony DiClemente.

“This allows CBS to continue to operate in a very nimble and autonomous fashion,” DiClemente said. “For Viacom, I think in terms of long term strategy, the verdict is still out.”

Viacom said in a statement that it received the letter sent by National Amusements and will provide more updates later. CBS referred comment to National Amusements.

Viacom Inc. Class B shares fell $3.01, or 7.8 percent, to $35.61 in afternoon trading Monday. CBS Corp. Class B shares slipped 4 cents to $62.52. </s> Redstone's daughter Shari, who controls CBS's and Viacom's controlling shareholder National Amusements together with her father, told the New York Times Dealbook conference last month that scale was crucial for both companies, because it would give them greater pricing power in content distribution.

National Amusements, however, does not currently want to sell either company, according to people familiar with the matter who requested anonymity discussing confidential deliberations. The chief executives of CBS and Viacom are also currently not keen on making big acquisitions, because they are focused on executing their operational strategy, these people said.

Nevertheless, the two companies may be forced to consider acquisitions if they come under more competitive pressure, the sources said. They may also turn to partnerships with media companies as an alternative to outright acquisitions, the sources added.

"Should Viacom remain independent, we think it will need a strategic partner to help co-finance a larger and more expensive film slate," Brean Murray analyst Alan Gould said in a research note on Monday.

Pressure on media companies to consolidate has increased in the last two months, as some industry giants have sought to merge with major distributors of their content, in a bid to expand their reach and profitability.

In October, U.S. telecommunications giant AT&T Inc agreed to acquire media conglomerate Time Warner Inc for $85.4 billion, while last week Rupert Murdoch's Twenty-First Century Fox Inc reached a preliminary agreement to acquire the 61 percent of Sky Plc it does not already own, valuing the British broadcaster at $23 billion.

Viacom has already been looking at some modest acquisitions. Last month it acquired Argentine broadcaster Telefe for $345 million in cash, and in 2014 it paid $760 million for British broadcaster Channel 5.

Were Bob Bakish, who was named on Monday as the permanent replacement of previous Viacom CEO Philippe Dauman, to explore more acquisitions, he could again look across the Atlantic for opportunities beyond the fiercely competitive U.S. media market, the sources said.

German broadcaster ProSiebenSat 1 and its main rival, RTL Group, would be logical targets, the sources said, as would ITV Plc in Britain and Entertainment One in Canada. However, Viacom's $12 billion debt pile makes it unlikely it would spend top dollar on acquisitions.

There may be smaller deals for Viacom to pursue, however, that could boost its Paramount movie studio. MGM, which owns a film library and has been exploring its options for some time following its emergence from bankruptcy six years ago, could help boost Paramount's margins if it was acquired, some media bankers suggested.

None of these companies offered a comment on the possibility of being acquired by Viacom.

Jefferies LLC analyst John Janedis said in a research note that he thinks CBS should focus on buying "TV-centric content related assets, rather than cable networks and film."

However, CBS CEO Leslie Moonves' interest may be in buying a movie studio. Sources familiar with the matter said that CBS has approached Sony Pictures in recent weeks, although its owner, Sony Corp, has shown no interest in selling. Sony declined to comment.

Lions Gate Entertainment Corp, which has a movie and television studio, just closed its acquisition of Starz, and could also be an option for CBS, according to one media banker.

AMC Networks Inc, controlled by New York's Dolan Family, could also have operational synergies with CBS's cable channel, Showtime. Lions Gate did not respond to requests for comment and AMC declined comment.

To be sure, Moonves publicly has said CBS can do without any major acquisition.

"Will we ever be of a scale of a Disney or an Apple? I doubt it. We are able to play the game just fine as long as we keep doing what we do, which is produce great content for CBS, for Showtime, for whatever the platform is," Moonves told the UBS Global Media and Communications Conference last week.

An alternative to acquisitions may be partnerships, including between CBS and Viacom. Bakish has already been meeting with heads of Viacom affiliates talking about potential partnerships, one of the people said. Last month, he told Reuters finding ways to partner with affiliates was a priority for the company.
National Amusements announces CBS Corporation and Viacom media companies will not be merging. CBS shares rose 1.8 percent closing in on a nearly 2-1/2 year high while Viacom fell 6.9 percent.