Earlier today, on Tuesday, Aug. 13, 2019, media giants Viacom Inc. and CBS Corp. formally came to an agreement after several consecutive months of day-in, day-out negotiations to merge into an even more powerful mass media entity than each of them was on their own. The company will take the name of ViacomCBS Inc., though it’s likely that the entity will take on a new name at some point over the next few months.
CBS Corp., according to company officials, as well as per Viacom company officials, noted that it would be acquiring Viacom’s assets through paying its owners in CBS Corp. stock. The two companies agreed that the value of Viacom was roughly $12 billion at the time the merger was finalized.
To get technical, every share of Viacom stock will be exchanged for exactly 0.59625 shares of CBS stock. This holds true for both Viacom Class A voting and Class B non-voting shares, which will be swapped for CBS’s Class A voting and Class B non-voting shares, respectively.
Based on the two companies’ most recent financial statements, the combined total revenue for the 2018 fiscal year of CBS and Viacom stands at a whopping $28 billion.
Both CBS Corp. and Viacom Inc. are owned and operated by National Amusements Inc., a media conglomeration that is owned by Sumner Redstone and operated by President Shari Redstone. At one point, the two companies were one in the same, though National Amusements had made the executive decision to break them apart.
Now, according to sources within the two companies, they merged with the primary goal of becoming more competitive in today’s media environment, which is notably. More competitive than at any point in the last few decades. This is because there are so many streaming services in today’s world. Together, ViacomCBS Inc. will be able to offer more media to consumers in the same place online in the form of on-demand streaming.
Viacom’s current Chief Executive Officer, Bob Bakish, will be assuming the role of CEO of ViacomCBS Inc.
National Amusements President Shari Redstone has put forth tons of effort over the past decade to bring the two companies together. Further, executives of the two companies have engaged in negotiations to merge with one another for roughly the past three years. Reports from unnamed sources within one of the two companies indicate that CBS and Viacom were in trade talks for roughly the past five months before culminating in the official announcement that the two companies would be joining corporate hands with one another.