Viacom power struggle comes to a close with Sumner Redstone taking control
The turbulent fight over $40bn media company Viacom has come to a close, with 93-year-old billionaire Sumner Redstone taking control.
Sumner Redstone
A settlement agreement has been reached ending the battle between Redstone and his daughter Shari Redstone, against directors at Viacom and granddaughter Keryn Redstone, who entered the battle in June. Redstone now takes complete control of Viacom - which owns MTV, Comedy Central, Nickelodeon and Paramount Pictures - and CBS.
Philippe Dauman, who had been Viacom's chief executive, will be removed from the position and his duties as president, under a settlement that includes a $72m payoff. He remains non-executive chairman until 13 September. The company's chief operating officer, Thomas Dooley, will serve as interim chief executive.
The fight over Redstone’s empire kicked off in May, when the media owner ousted two of his former confidantes, Philippe Dauman and George Abrams. The decision removed both men from the trust that will control Redstone's affairs when he dies or is declared incompetent.
The long drawn out legal battle between members of the company and members of the Redstone family that commenced were focused on whether Redstone, 93, had the mental capacity to run the business and whether he was being dictated by long-estranged daughter Shari. Shortly after Shari reentered Redstone’s life, his alliances switched.
Granddaughter Keryn Redstone, 34, pitched in to the high-level fight in June saying she felt compelled to enter the legal fracas because she believes that her aunt, Shari, is dictating the actions of her grandfather.
“Shari and her family have managed to totally isolate and effectively kidnap, brainwash and take advantage of my grandfather due to his debilitated state of mind and frail health,” Keryn Redstone said.
“I want to express my support for the Viacom directors who have tried to meet with my grandfather but have been denied access by Shari Redstone,” she added, “There is no way that a competent Sumner Redstone, acting with his own free will, would ever refuse to meet with his fellow directors who have been his close friends and allies and so loyal to him over many years.”
While a resolution has been reached over control of Redstone’s business empire, the business has been significantly harmed in the process. The company has reported consistent declines in profit and revenue, with its profit dropping 27 per cent in its fiscal third quarter this year. Its share price has tumbled about 47 percent in the last two years.