Viacom boss Sumner Redstone may have found a way to overcome the difficult task of choosing a successor. There has been much speculation as to whom the 81 year old media mogul would hand over control of the media conglomerate when he eventually stands down - with two senior execs both likely candidates: Tom Freston and Leslie Moonves.
Under
Redstone's latest proposal both would win, kind of. Redstone is proposing splitting the group into two - MTV and CBS. The former would be led by Freston and would include all the MTV networks plus Nickelodeon, Showtime Comedy Central, BET, Paramount
TV and Pictures and Simon & Schuster. The latter would be led by Moonves and would include CBS, radio group Infinity and the group's outdoor advertising business.
Calling the proposal "dramatic", Redstone told the **New York
Daily News** that he had been considering that concept "for many, many months". The main reason for the split (it's not just about keeping two senior execs happy!) is that Redstone feels the youth focused MTV companies attract different investors than the more conservative CBS. The split might strengthen the perceived value of both among relevant investment communities.
In a statement Redstone told investment types: "It is clear that, despite our success in operating our businesses for maximum return, Viacom's businesses have inherently different growth characteristics and investment attributes that appeal to different types of investors. Furthermore, it has also become clear that this important distinction is likely to continue to limit Viacom's ability to receive full value for its assets and its prospects in the investment community. The extent and detail of explanation makes the Viacom board's exploration of the idea seem pretty real, even if it isn't official...yet."