It could be that the best thing that could happen to Viacom (VIA-B) is that it would be sold. The continuing squabble within the Redstone family isn't good for the business.
The latest battle is between Sumner Redstone and his daughter Shari, which evidently was sparked by Shari pushing to tie executive compensation to performance, according to unnamed sources close to the situation.
After a big battle Sumner and his son Brent earlier this year, it looked like Shari would be the heir apparent to the company. That possibility looks like it is in jeopardy at this time. The dispute centers around an agreement in a trust where Shari believed she would automatically succeed her father as head of Viacom. Sumner disputes her interpretation, and believes the board should make the decision on his successor.
Getting past the personal reasons concerning the family dispute, this will have an impact upon the overall business. At this time sources say the two sides are in negotiations concerning a separation agreement which would result in Shari buying out the National Amusements theater chain. At this time, National Amusements controls 80 percent of Viacom's voting stock.
This is too bad, not just from the personal standpoint, but professional as well. I've followed Shari the last couple of years, and she's had some great ideas and has been a thought leader in the challenge movie theaters face with the uncertain future of theaters.
Also her idea of tying executive compensation to performance is a really good idea too. I think it's Viacoms' loss not to have her as a leader, if that's the way it ends up.
All of this is probably tied to a man that doesn't want to face his mortality, and is making decisions based upon that. But even including that, Sumner Redstone has had a history of not being able to work with anybody for a very long period of time before he must take the reigns.
If Shari ends up being bought out, upon Sumner's death, Viacom and CBS (CBS-A) will probably result in the sale of the two companies.
Comment Preview