Media powerhouses CBS and Viacom reach merger deal

CBS finally put a ring on it.

After years of discussions, CBS Corp. and Viacom Inc. have agreed to merge in a deal that will better position the two TV companies to compete against streaming video giants like Netflix and Disney.

The all-stock deal, announced Tuesday, unites CBS’s Showtime with Viacom’s Nikelodeon and MTV, the makers of “SpongeBob SquarePants” and “Jersey Shore” respectively. It reunites Sumner Redstone’s media empire for the first time since they split in 2006.

The new company will be called ViacomCBS and Redstone’s daughter, Shari Redstone, will be named chair. Shari Redstone — who heads National Amusements, the majority shareholders of both CBS and Viacom — has been pushing for the companies to reunite for years.

As part of the deal, the boards agreed on an exchange ratio of 0.59625 CBS share for every Viacom Class B share, which means CBS’s current shareholders will own 61 percent of the combines company versus Viacom holders who get 39 percent.

Robert Bakish
Robert BakishGetty Images

The new ViacomCBS will have a market capitalization of $30 billion, but that still pales in comparison to competitors like Netflix, valued at $136 billion, and Walt Disney, valued at $245 billion.

It’s one reason Wall Street analysts and other media sources expect Shari Redstone to continue to hunt for acquisitions, including film studio Lionsgate or its premium cable network Starz.

As The Post recently reported CBS has recently considered acquiring Take-Two, the gaming company run by CBS interim chairman Strauss Zelnick, Sony Pictures and MGM. It has also mulled a potential merger with Discovery Communications, which owns the hit new reality show “90 Day Fiance” through its TLC network.

While another acquisition could come later, the CBS-Viacom deal has long been Shari Redstone’s top priority.

The two companies came close to merging a year ago but a rift over who would run the combined company derailed talks. At the time, Les Moonves was head of CBS. He has since left amid a series of sexual harassment complaints.

Viacom also nixed plans to merge with CBS in 2016.

Viacom’s current boss Bob Bakish has been named the combined company’s president and CEO. Joseph
Ianniello, CBS current acting CEO, will continue to run the CBS’ assets in his new role as chairman and CEO of CBS.

He took over the interim job last year after Moonves stepped down amid sexual misconduct allegations.

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