If a judge affirms the new directors slate, they have the authority to overhaul Viacom’s management, which could include Dauman’s removal as CEO. Dauman and Abrams from the board of National Amusements Inc., the holding company through which Mr. Redstone controls Viacom, and the seven-member trust that will oversee his controlling stakes in Viacom and CBS Corp. when he dies or is incapacitated. Viacom lead independent director Fred Salerno, an ally of Dauman, has asked the court to deem the move invalid, arguing Redstone has been unduly influenced.
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Viacom said it expects adjusted earnings of about $1.00 to $1.05 per share in the quarter. The company also previously expected to complete a significant SVOD agreement in the quarter, but said the recent and highly public governance controversy negatively impacted the timing and its ability to achieve an optimal outcome with partners.
Viacom’s ad sales chief, Jeff Lucas, crossed the upfront finish line first despite turmoil at his company.
The company cited the Teenage Mutant Ninja Turtles movie and a delay in completing an agreement with an unnamed streaming video provider. Dauman claims a sale would lift Viacom’s stock price by $10 a share, but Redstone is vigorously opposed to the idea.
Media mogul Sumner Redstone has moved to replace five board members of Viacom Inc., including the chairman and CEO whom he has considered a surrogate son. Viacom shares sank 1.9 percent to $44.20 in early trading. “Under Mr. Redstone’s long-standing estate plan, control and management would remain independent of Shari, for whom Mr. Redstone generously provided but who he determined did not have the skills to control or manage Viacom and from whom he was bitterly estranged for many years”.
National Amusements filed papers with a DE court to reaffirm the move, to which Salerno immediately responded with filings of his own.
Dauman, the third highest-paid CEO in America past year, has been criticized by analysts and investors alike for failing to keep up with changes wrought by the internet on Viacom’s TV networks like Comedy Central, MTV and Nickelodeon.
“The need for strong, independent oversight of Viacom could not be more apparent”. In recent days, Mr. Redstone has met with top CBS and Paramount Pictures executives, though they came to his auto and details of the meetings weren’t available.
Redstone is also fighting accusations in a MA probate court that he is “not mentally competent … and was in effect being manipulated by his daughter Shari”, David added.
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“Barring a great bid for the whole of Viacom, we believe National Amusements knows its best strategic move is to move quickly to recombine Viacom and CBS”.
