CBS and Viacom agree billion-dollar merger to challenge Disney and Netflix

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In a statement, both companies said they will accelerate their streaming plans and reach out to new global markets.

That isn't stopping Viacom CEO Bob Bakish, who will lead the combined company, to declare that ViacomCBS will be "one of only a few companies with the breadth and depth of content and reach to shape the future of our industry". Which ever point of view you take, the result is this: ViacomCBS Inc.is now a stronger power player that combines the company's #1 ratings across all key TV demographics and strong performances across all genres with direct-to-consumer offerings (through subscriptions and ad-supported platforms), as well as feature film production through Paramount Pictures.

The deal would unite the most-watched US broadcast network with the owner of the Paramount movie studio and cable channels such as MTV and Nickelodeon. "Frankly, they may not be big enough still to compete with Disney and Netflix", he said, noting that "Netflix spends something like $15 billion on new product".

Viacom, CBS, Redstone's National Amusements, Sony and Discovery declined to comment. There were previous attempts to merge the two companies but to no avail. Shari Redstone - who heads National Amusements, the majority shareholders of both CBS and Viacom - has been pushing for the companies to reunite for years.

Joe Ianniello, the president and acting chief executive officer of CBS Corp., will become chairman and CEO of CBS, overseeing all CBS-branded assets in his new role, the companies said.

The companies said in a press release that they agreed to an all-stock merger that would combine the largest USA television business with a major Hollywood studio in Paramount Pictures and other businesses that "accelerate CBS and Viacom's ability to deliver an array of compelling content to important and diverse audiences across both traditional and emerging platforms around the world".

CBS Class B shares were up 0.7% to $48.36, also off of earlier highs. It is unlikely that CBS-Viacom could itself become an acquisition target, given how potential acquirers nearly all have their hands full with their own big purchases. CBS already had its CBS All Access streaming service and Showtime has its own subscription service as well, but The Verge says ViacomCBS "will be able to offer a library of more than 140,000 TV episodes and more than 3,600 movies", including the Transformers franchise.

CBS and Viacom have ties that go back to the 1970s.

The companies have sought a merger several times in recent years, but their management teams' differences were never bridged.

The combined content of CBS and Viacom will make it formidable in the streaming market. In response, legacy media companies are consolidating to bulk up.

Redstone will be chairwoman of the combined company's board. Her efforts had been blocked by former CBS CEO Leslie Moonves and the CBS board.

"We would want to look at something after that to. develop more scale as we move forward", Redstone said at The Information's Women in Tech, Media and Finance conference in June.

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