CBS and Viacom merge to form company with over US$28bn in revenue

CBS Corp and Viacom are merging to form ViacomCBS Inc., with the combined company having more than US$28 billion in revenue. This comes more than 10 years after the two companies first split in 2005.

ViacomCBS will now possess a portfolio of renowned consumer brands including CBS, Showtime, Nickelodeon, MTV, BET, Comedy Central and Paramount Network. It will also own one of the largest libraries of intellectual property comprising over 140,000 TV episodes and 3,600 film titles.

The all-stock merger will also make ViacomCBS a broadcast and cable leader in key markets around the world including Asia, the US and Europe, reaching more than 4.3 billion cumulative TV subscribers, the press release said. This includes its TV business in the US with the highest share of broadcast and cable viewing across key audience demographics, and strength in every key category including news, sports, pop culture, comedy and music. The merger comes a year after Disney acquired Fox for US$71.3 billion.

In a quickly evolving media landscape, the combined company will benefit from its distinct competitive position as one of the most important global content providers, for its own platforms as well as for third parties. This will enable the combined company to accelerate the growth of its direct-to-consumer strategy, enhance distribution and advertising opportunities and create a leading producer and licensor of premium content to third-party platforms globally, it said.

As part of the merger, ViacomCBS listed a three-part strategy for growth - enhance distribution and advertising opportunities; accelerate direct-to-consumer strategy; and creating a leading producer and licensor of premium content to third-party platforms globally.

The breadth and depth of ViacomCBS’ reach across both traditional and new platforms will drive important new distribution and advertising opportunities.

For advertisers and agencies, the combined company will provide industry-leading reach through a variety of formats, including a portfolio of differentiated advanced advertising and marketing solutions.

These cover CBS Interactive, Viacom Vantage and Viacom Velocity, which will be applied against significant, expanded inventory across the portfolio. For distributors, this includes forming more expansive and multifaceted relationships, and applying the benefit of retransmission consent across a combined portfolio.

Meanwhile, the new company will be positioned to accelerate and expand its direct-to-consumer strategy through its proven and diverse portfolio of both subscription and ad-supported offerings. These include CBS All Access and Showtime, which deliver branded content live and on demand to subscribers; free streaming TV service Pluto TV; and niche products such as CBSN, ET Live and Noggin. It also has an opportunity to expand globally by leveraging its existing strength in both subscription and ad-supported offerings, combined library, content production capabilities and international infrastructure.

As one of the biggest premium content providers in the world, ViacomCBS said it is positioned to deliver content to a diverse global customer base that includes MVPDs, broadcast and cable networks, subscription and ad-supported streaming services, mobile providers and social platforms. Notably, in addition to content licensing, CBS and Viacom are developing must-watch programming for a broad range of third-party networks and platforms to feed significant demand for original, premium content.

Viacom's president and CEO Bob Bakish will become president and CEO of ViacomCBS, while CBS' president and acting CEO Joe Ianniello, will now helm the role of chairman and CEO of CBS, overseeing all CBS-branded assets.

Bakish said its unique ability to produce premium and popular content for global audiences at scale will enable the company to maximise its business for today, while positioning it to "lead for years to come".

"As we look to the future, I couldn’t be more excited about the opportunities ahead for the combined company and all of our stakeholders – including consumers, the creative community, commercial partners, employees and, of course, our shareholders," he said.

"This merger brings an exciting new set of opportunities to both companies. At CBS, we have outstanding momentum right now – creatively and operationally – and Viacom’s portfolio will help accelerate that progress. Personally, I am pleased to remain focused on CBS’s top priority – continuing our transformation into a global, multiplatform, premium content company," Ianniello added.

In addition to Bakish and Ianniello, the leadership team of the combined company will include Christina Spade as EVP and CFO; and Christa D’Alimonte as EVP, general counsel and secretary.

The board of directors will consist of 13 members: six independent members from CBS, four independent members from Viacom, the President and CEO of ViacomCBS and two National Amusements, Inc. (NAI) designees. Shari Redstone, vice chair of the boards of Directors, CBS and Viacom, will be appointed chair.

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