CBS executive chairman Sumner Redstone is resigning and network President & CEO Les Moonves being named the new chairman. Shari Redstone will continue with her duties as vice-chair, while the senior Redstone will stay on as chairman emeritus.
The move is likely to prompt comment from many who believe Redstone’s health has declined to the extent that he is no longer capable of running his $45 billion media empire.
Manuela Herzer, Redstone’s former girlfriend, filed a lawsuit in Los Angeles Superior Court in November, claiming that Redstone’s mental capacity was deteriorating and that he should be examined and declared incompetent to run Viacom and CBS.
As part of that legal battle, last week Mr Redstone underwent a mental examination.
Vidal has called Herzer’s petition a “meritless action, riddled with lies, and a despicable invasion of (Redstone’s) privacy”. Philippe Dauman is the president/CEO of Viacom.
Mr Redstone took over Viacom – which owns Paramount Pictures, Nickelodeon, MTV and Comedy Central, among other assets – in 1987.
CBS and Viacom together are worth about $40 billion. “We’ve been running the company very well, and the future looks very bright, and not much is going to change”. He is now one of the seven trustees who will manage the trust that Redstone’s shares will go to in the event of his death. At that time, his interests will pass to his grandchildren and their descendants, and a seven-person trust will manage the holdings by majority vote. VIA, +1.93% VIAB, +2.10% Viacom shares rose more than 7% after hours Wednesday. Last year, Viacom took a $785 million pretax charge for job cuts and write-downs on underperforming shows.
In a wrinkle to succession plans, Redstone’s daughter Shari said in a statement she had gone against her father’s stated intention that she succeed him and instead nominated Moonves as a “leader with an independent voice” who is not “otherwise intertwined in Redstone family matters”. Last month Bloomberg reported that she was willing to let Moonves have the position at CBS. That excluded herself and fellow trust member Dauman. He said Redstone was widely expected to resign at Viacom.
Mr. Jackson is pushing for a complete overhaul of the board and Mr. Dauman’s ouster as chief executive. Analysts expect Redstone will also resign as executive chairman of Viacom. The entertainment company’s board will meet tomorrow.