Share

MTV parent's fight more juicy than what's on TV

New York - MTV's roster of reality shows not doing it for you anymore? Then tune into parent Viacom's corporate in-fighting instead. More juicy drama can be found inside its New York City headquarters right now than on its cable-TV networks.

Viacom also owns Comedy Central, but there's not much to laugh about here. There's something unsettling about the fact that a $16bn company (worth twice that a year ago) can go through such upheaval in its top ranks, and leave minority shareholders pretty much in the dark about little things like the company's fate.

Sumner Redstone, who turns 93 this week and can barely communicate any more, was recently removed as chairperson of Viacom (and CBS). Even so, he and his dysfunctional family still wield the power over the two media giants through controlling stock, which will be inherited by a family trust when he passes. So to all the observers who have put on their activist hats this week and proposed that Viacom's fix is to just sell itself: Careful, you're reading from a corporate governance playbook that Viacom simply doesn't follow.

If this were a normal situation, sure, a sale would be likely. But it's become clear that the Redstones and the trust are a major block to any big strategic moves, while it's entirely unclear who's running the show. Is it still Sumner? His daughter Shari Redstone? Do the executives and boards have any say at all?

Rather than wasting their time attempting the impossible in pushing for a sale, minority investors (and any sensible voices on the board) would be better off looking for a mechanism through the courts to provide greater transparency. They could even pursue a change of the trust's structure or control, since it's the trust that's making it impossible for the board to fulfill its duty to act on behalf of all investors.

Indeed, it's hard to make sense of the trust at all, given the recent machinations around its membership.

Last week, two former allies of Sumner's were suddenly ousted from the trust: Viacom CEO Philippe Dauman (who recently took over as Viacom chairperson too, despite the disapproval of Shari) and Viacom director George Abrams. This renders Dauman's chairmanship almost meaningless because - as we all know - it's Sumner and the trust that calls the shots.

The Redstones contend the removal of the two men was Sumner's decision, but Dauman and Abrams are fighting the move, accusing Shari of manipulating her father, whose mental competence has come into question in recent months. Here were the remaining trustees as of Monday (try to resist the lawyer jokes):

Tyler Korff, Shari's son and a lawyer Norman Jacobs, Sumner's divorce lawyer Leonard Lewin, a lawyer who represented Sumner's first wife in their divorce David Andelman, a lawyer who also has a seat on CBS's board.

On Tuesday morning, Sumner (or whoever) named the two replacements for Dauman and Abrams: Tad Jankowski, yet another lawyer and an executive at Redstone's National Amusements (the family holding company through which he owns Viacom and CBS voting rights), and Jill Krutick, a longtime media analyst who used to cover Viacom and also served as an executive at Warner Music Group.

Amid the chaos and confusion, it's easy to understand the anguish of normal non-family shareholders. What's certain is that Viacom can't continue like this much longer; there needs to be a resolution because public companies owe that much to shareholders. Until then, why not turn on some cameras and start filming "Real World: Viacom" to boost those TV ratings.

* This column does not necessarily reflect the opinion of Bloomberg and its owners.

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
19.00
-0.3%
Rand - Pound
24.14
-0.1%
Rand - Euro
20.65
-0.3%
Rand - Aus dollar
12.38
+0.3%
Rand - Yen
0.13
+0.5%
Platinum
905.16
-2.0%
Palladium
1,006.63
+0.1%
Gold
2,157.24
-0.2%
Silver
24.94
-0.4%
Brent Crude
86.89
+1.8%
Top 40
66,252
0.0%
All Share
72,431
0.0%
Resource 10
53,317
0.0%
Industrial 25
100,473
0.0%
Financial 15
16,622
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders