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Her father said she was a lightweight. Now Shari Redstone will run the show at ViacomCBS

Meg James, Los Angeles Times on

Published in Business News

Just a few years ago, Shari Redstone was on the outs of her family's far-flung media empire. Her father, Sumner Redstone, once dismissed her publicly as a lightweight who contributed little to the family's business. Instead, he surrounded himself with younger girlfriends and business cronies.

Tensions were so high that he offered her a $1 billion buyout, and she fumed to her son in 2015: "Your grandfather says I will be chair over his dead body."

But on Tuesday the boards of CBS and Viacom agreed to reunite the two Redstone-controlled companies that were torn apart 13 years ago. And they announced that Shari Redstone would become chairwoman of the new entity, ViacomCBS Inc., joining a small sorority of women overseeing a major U.S. company.

Under the nearly $12 billion deal, CBS will absorb the smaller Viacom, which owns such brands as MTV, Nickelodeon, Comedy Central and Paramount Pictures.

The merger agreement is a triumph for Redstone, who has overseen the family's controlling stakes in the two companies since her father's declining health forced him to relinquish control. She pushed for the union, believing the two companies would be stronger together during a turbulent time. The entertainment industry is facing intense pressure from technology behemoths Netflix, Amazon and Google Inc., which introduced popular alternatives to traditional television. The changing economics has created a sense of urgency among major Hollywood studios to fortify themselves by bulking up.

"I am really excited to see these two great companies come together so that they can realize the incredible power of their combined assets," Shari Redstone said Tuesday in a statement. "We will establish a world-class, multiplatform media organization that is well-positioned for growth in a rapidly transforming industry."

 

In the last three years, she has proved herself as a worthy successor to her 96-year-old father, known for his stubborn streak and ability to outlast opponents. Since re-entering her father's life in late 2015, Redstone has vanquished more than a dozen men whom her father put in power. She halted a plan to sell the storied Melrose Avenue movie studio, Paramount Pictures, and now she has corrected what she long considered a mistake -- her father's separation of CBS and Viacom in 2006.

"Shari has definitely proven herself as an effective strategist, someone who is willing to go to whatever lengths she needs to get something done," said Jordan Matthews, an entertainment attorney with Weinberg, Gosner in Los Angeles. "People underestimated her, but she's proven that she's obtained a lot of her father's characteristics."

The deal is subject to regulatory approvals, but the new company is already taking shape. Shari Redstone's hand-picked lieutenant, Bob Bakish, will oversee the new ViacomCBS as chief executive. Their strong working relationship ensures that Shari Redstone no longer will be the subject of boardroom resistance. Instead, she will be integrally involved in steering the ship as it tries to compete with much larger media and technology companies, such as Walt Disney Co., Netflix and Amazon.com.

Redstone, as board chair, joins an elite group of women. Only 7% of the largest U.S. companies in Standard & Poors' top index have a woman as a board chair, according to Fenwick & West, a Mountain View, Calif., law firm. In another 14% of those S&P 100 firms, a woman was lead director -- another key board post.

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