After some false starts, CBS and Viacom announced Tuesday they will combine to form the latest media empire in a wave of mergers driven by the need for companies to reformulate themselves for the streaming era.
The new company will have more than $28 billion in revenue and comprise brands such as MTV, Comedy Central and Showtime, as well as Paramount Pictures and publisher Simon & Schuster.
The transaction will bolster their ability to develop original programming that can win subscribers to premium channel, score well with advertisers and resonate with audiences in international markets, the companies said.
The deal recombines two entities that were under the same corporate umbrella until they were broken apart in 2006 by Sumner Redstone, chairman emeritus of National Amusements, which holds almost 80 percent of both companies.
The deal comes on the heels of other large transactions in media, including Disney’s $71.3 billion acquisition of key assets from Rupert Murdoch’s 21st Century Fox, and AT&T’s $85 billion purchase of Time Warner.
“I am really excited to see these two great companies come together so that they can realize the incredible power of their combined assets,” said Shari Redstone, who will chair the new company, ViacomCBS.
“My father once said ‘content is king,’ and never has that been more true than today,” she said in a statement. “We will establish a world-class, multi-platform media organization that is well-positioned for growth in a rapidly transforming industry.”
The two companies failed in their earlier attempts to pull off a merger, due in part to opposition from former CBS chief executive Les Moonves, who was ousted in September 2018 amid sexual harassment allegations.
Joining forces will allow them to bolster investment in premium entertainment and boost their global reach, with broadcast networks in Britain, Argentina and Australia and content in 45 languages, the companies said in a press release. The deal also should result in $500 million in annual savings.
“The more scale you have, the more clout you have when go to in to negotiate with distributors or even with direct-to-consumers,” said Tuna Amobi, analyst at CFRA Research. “It gives them a better chance to compete.”
– Streaming era –
The traditional media industry is battling to deal with the rise of Netflix, Hulu and other streaming ventures that erode the position of conventional cable packages and broadcasters unveil “over-the-top” options.
CBS itself has launched its “All Access” service which provides on-demand programming for $5.99 per month with limited commercial interruptions or $9.99 per month for ad-free service.
And Disney in November plans to launch a new “Disney+” service at a starting price of $6.99 monthly that offer its films and television shows as well as the library it acquired through the Fox deal.
Under the all-stock transaction in the latest tie-up, existing CBS shareholders will own 61 percent of the company, while Viacom shareholders will own 39 percent.
Bob Bakish, chief executive of Viacom, will assume that post in the newly-combined company, while Joe Ianniello, acting chief executive at CBS, will become chairman and CEO of CBS, overseeing CBS-branded assets.
Shares of Viacom fell 5.6 percent to $30.75, while CBS rose 1.4 percent to $48.70.
West Virginia woman rushes to Mexico border with secret government documents — then seeks asylum in Russia
NBC News 4 investigative reporter Scott MacFarlane discovered a strange tale that could be Russia's next espionage scandal.
According to court filings of the incident, a West Virginia woman has confessed to driving to Mexico with her daughter with a series of top-secret U.S. government documents. She then sought asylum in Russia.
The documents MacFarlane posted on Twitter detail the items that were seized by the FBI and the travel that Ms. Elizabeth Shirley appeared to make from West Virginia to Mexico City.
Dalai Lama channels ‘Inner World’ in album to mark 85th birthday
Tibetan spiritual leader the Dalai Lama launched an assault on the music charts on Monday by releasing his first album to mark his 85th birthday.
"Inner World", in which the Dalai Lama chants meditations and Buddhist sayings, was inspired by New Zealand follower Junelle Kunin who spent five years working on the project after persuading him to take part.
The Dalai Lama went to her home in Auckland three times and she recorded some sessions at his residence in Dharamsala in India, where the Tibetan government in exile is based.
"He had a clear vision with this work and has been very committed to it," Kunin, who produced the music with her husband Abraham, told the Radio New Zealand programme Nine to Noon.
Fossil of giant 70 million year-old fish found in Argentina
A giant 70 million year old fossil of a fish that lived amongst dinosaurs has been discovered in Argentine Patagonia, a team of researchers said on Monday.
Argentine paleontologists "found the remains of a predator fish that was more than six meters long," the researchers said in a statement.
The discovery was published in the scientific journal Alcheringa: An Australasian Journal of Palaeontology.
The fish "swam in the Patagonian seas at the end of the Cretaceous Period, when the temperature there was much more temperate than now," the statement said.