Viacom Says It Hired Advisers to Evaluate a Merger With CBS

By Joshua Jamerson 

Viacom Inc. said Friday it has hired financial advisers to help evaluate a potential deal to merge with CBS Corp.

The Wall Street Journal last week reported that the company hired Morgan Stanley, citing people familiar with the matter. Viacom said Friday that the special committee on Viacom's board is evaluating the prospects of a marriage have indeed hired Morgan Stanley, as well as Allen & Company and LionTree LLC. Viacom said it doesn't plan to comment further "unless and until it determines that additional disclosure is appropriate."

CBS's special committee, for its part, has retained Lazard as its financial adviser and Morton Pierce of White & Case as its legal counsel, The Journal reported.

The disclosure from Viacom comes two weeks after Sumner Redstone's National Amusements Inc., which controls the boards of both companies, publicly called for the firms to explore a reunion of the media giants, arguing that a combined company could better tackle shifting consumer trends.

A merger would bring under one roof CBS, a prime-time ratings juggernaut, and Viacom's struggling networks, such as MTV and Comedy Central, which typically pursue younger audiences that have been drawn to streaming services such as Netflix.

Given the struggles of Viacom's cable networks and its Paramount Pictures studio, finding a valuation that both sides can live with will be one of the big challenges in pulling off a deal, and there will be plenty of work for the investment banking and law firm crowd.

Viacom shares, up 0.5% in morning trading, has fallen 20% in the past three months. CBS stock, up 1% in morning trading, is down 3.5% in the past three months.

Write to Joshua Jamerson at [e-mail]

(END) Dow Jones Newswires

October 14, 2016 09:54 ET (13:54 GMT)

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