A special committee of Viacom’s board of directors tasked with investigating the viability of a merger with CBS said it has formally hired advisors to look into the matter.
The special committee, consisting of six independent Viacom board members, said it has hired Morgan Stanley, Allen & Company and LionTree LLC. The committee added that it had previously engaged Debevoise & Plimpton LLP as its independent legal advisor.
In a statement, the special committee said it doesn't intend to comment further unless and until it determines that additional disclosure is appropriate.
Viacom’s largest shareholder National Amusements formally requested the programmer look into a CBS merger in September. National Amusements also is the largest voting shareholder of CBS.
CBS and Viacom split into two separate companies in 2006 in an effort to unlock hidden value in both entities. But since the split, Viacom has faltered as low ratings and declining ad sales have pummeled its stock. CBS, which has dramatically grown its retransmission consent revenue – expected to reach $1 billion this year – and rejuvenated its Showtime premium channel, has fared much better.
In August, CEO Philippe Dauman stepped down, clearing the way for a new leader at the programmer. His former lieutenant, chief operating officer Thomas Dooley agreed to serve as interim CEO but later in the month, in conjunction with Viacom’s decision to cut its dividend in half, said he would leave the company in November.
Wall Street has long been in favor of CBS chairman and CEO Les Moonves taking the reins at Viacom, and reports have said he is currently in talks with National Amusements. Those reports have said Moonves is most concerned about retaining autonomy in running the two companies in the shadow of NAI's mercurial top shareholder Sumner Redstone and his daughter Shari.