The Big Bang Theory

14 May 2018 By Jennifer Saba Follow @jennifersaba

The company led by Les Moonves is suing its controlling shareholders. The idea is to stop Shari Redstone replacing directors, giving the board time to dilute the family’s voting rights and so escape a bad merger with Viacom. Right now, though, it’s a lot about egos.

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CBS and a special committee of its board of directors on May 14 sued controlling owner National Amusements. CBS is seeking to call a special board meeting on May 17 at which directors will consider declaring a dividend of shares of Class A common stock to all the company’s Class A and Class B shareholders.

National Amusements, the investment vehicle controlled by the Redstone Family, owns nearly 80 percent of Class A voting shares. Class B stakeholders do not have a vote. If the dividend is issued, National Amusements’ voting interest would be diluted to under 17 percent.

CBS said the committee is seeking to “protect stockholders’ interests and unlock significant stockholder value.” The move would allow the company to “more fully evaluate strategic alternatives.”

National Amusements controls a similar share of the vote at Viacom. Shari Redstone, vice chair of CBS and Viacom, has been seeking to merge the two media companies.

“NAI had absolutely no intention of replacing the CBS board or forcing a deal that was not supported by both companies. NAI’s conduct throughout supports this, and reflects its commitment to a well-governed process,” National Amusements said in a statement.

Shares of CBS were up more than 3 percent in morning trade on May 14 while Viacom shares declined nearly 7 percent.

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