After months of negotiations, CBS on Monday was prepared to make an offer for Viacom — at less than the New York parent of MTV, Comedy Central and Nickelodeon is currently worth, The Post has confirmed.
The expected offer, called a take-under, is seen as just an opening gambit by CBS boss Les Moonves and the final price may move higher.
The tougher issue, those close to the situation said, was hammering out who would head a combined company — both controlled by ailing media mogul Sumner Redstone’s National Amusements.
It has been determined that Moonves will lead the combined entertainment behemoth for two years, sources said.
On Monday, CBS’ shares closed down 1.3 percent, to $50.71, near a 52-week low. That gives it a $19.4 billion market cap.
The broadcaster really does not want to issue stock at a 52-week low, a source close to the talks said, explaining CBS’ relatively low offer.
Viacom shares closed down 2 percent, to $38.80, giving it a $12.8 billion market cap. Its shares since late October have rallied by about 30 percent — mostly on optimism of a merger, which has been vigorously pushed by Shari Redstone, Sumner’s daughter.
Reuters on Monday was the first to report the news on the upcoming offer.
A merger has a better than 50 percent chance of getting reached, one source close to the talks said.
“I feel more optimistic than in 2016” when the companies unsuccessfully explored the same merger, a second source with direct knowledge of the discussions said.
While Shari Redstone wants Moonves to stay, she has been wary of giving him too much power, sources said. Moonves has agreed turn the combined company over to a successor after the two years, sources said.
CBS and National Amusements declined comment.
Source: Read Full Article