Wednesday, August 14, 2019

CBS and Viacom announce merger agreement to create entertainment giant

The North American groups Viacom and CBS announced on Tuesday (13) their merger, which creates a global giant of films and television with revenues of about US $28 billion, second joint communiqué. The merger, which will be made by exchange of shares, gives life to ViacomCBS, a group that "occupies leadership positions in the United States, Europe, Latin America and Asia," the communiqué said. The new company becomes the largest television group in the United States and will also include the Paramount film studios and the publisher Simon & Schuster. The merger also gathers several successful franchises, such as the Star Trek sagas and Mission impossible. The group will also administer important services in the UK, Argentina and Australia, as well as cable channels in more than 180 countries. ViacomCBS will have revenues of US $28 billion and market value of approximately US $30 billion. The new group will be led by Bob Bakish, current CEO of Viacom. According to him, the combination of CBS and Viacom's assets and competencies allows us to create "one of the few companies with broad content and scope and varied enough to shape the future of our industry." This operation reconstitutes an entity that existed until 2006, before the National Amusements, a society that controlled both groups, decided to separate them. The daughter of the founder of National Amusements, who became the media group tycoon Summer Redstone, Shari Redstone, will be president of the new board. The merger must be completed before the end of the year, if permission is obtained from the competent authorities. Under its terms, current CBS shareholders will have 61% of the new entity and the shareholders of Viacom, 39%. New business model The announcement was made at a time when the audiovisual landscape in the United States is radically transforming, as "traditional" actors (television, studios, cable TV operators) face the rise of internet giants like Netflix, Amazon Prime Video or Apple TV. Faced with the new business model, without publicity, but through signatures, and its technological innovations, several groups have already felt the need to strengthen their offer to maintain their stature in the relentless dispute of American entertainment. For example, Disney bought most of 21 Century Fox for US $71 billion and plans to launch its own Disney + platform in November. The AT&T telecom giant acquired Time Warner (HBO, CNN, TBS and Warner Bros.), while Comcast did the same with NBCUniversal. Separate, CBS and Viacom could fight to gain more weight. But to justify the merger, companies especially emphasize that, if combined, they will have an even greater financial capacity to invest in new content and new technologies. In addition to its catalogs, of more than 140,000 television broadcasts and 3,600 films, they spent $13 billion on new content in the last 12 months. However, this merger will not occur without problems, because the two groups have already made several attempts to approach without success. CBS former director Leslie Moonves has long opposed the merger, desired by Shari Redstone, and the battle was brought to justice. However, Moonves was kicked off the board last September on charges of sexual assault.
G1 - 14/08/2019 News Item translated automatically
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