While CBS has not made a formal bid to buy Viacom, rumored merger talks have reportedly hit a roadblock over who would be second in command at the combined company, according to CNBC.
Reuters reported Monday that CBS intended to make an all-stock offer for Viacom that values Viacom below its current market valuation and would keep CBS CEO Leslie Moonves as the head of the company for at least two years.
The key issue now, though, is not financial aspects, but rather who would become Moonves’ No. 2, according to CNBC, which cited sources familiar with the matter.
Moonves, who wants to assemble his own leadership team, wants the job to go to CBS Chief Operating Officer Joe Ianniello, while Shari Redstone – controlling shareholder of both Viacom and CBS – favors Viacom CEO Bob Bakish, the sources said.
CNBC’s David Farber pointed out that Ianniello’s contract specifies that he’s entitled to a $70 million pay-out if he is not made number two following a merger. Bakish reportedly has a similar finical arrangement though the amount is unknown.
Viacom and CBS were formally split by controlling shareholder Sumner Redstone in 2006, and a bid from CBS would mark the first step to reuniting the companies. Special committees were set up in February by the companies’ boards to explore a merger, while earlier talks in 2016 ended without a deal.
