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Viacom/CBS eye merger?
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September 3, 1999: 4:32 a.m. ET
Negotiations on TV station deals reportedly extended to full merger talks
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LONDON (CNNfn) - CBS and Viacom have held talks in recent weeks on possible cooperation, even going as far as to discuss a full-scale merger, according to a press report Friday.
Recent federal legislation has given media companies greater scope to reshape their television station assets, and the New York Times reported Friday that the two groups have talked about ways to save costs by increasing programming flexibility.
Both companies have also talked with other players in the industry, the newspaper reported. But analysts are more excited about the Viacom/CBS negotiations because they have gone further, allegedly touching a merger of the companies overall, according to entertainment industry sources quoted by the newspaper.
The newspaper said such a deal would find favor on Wall Street as the companies could combine their radio assets as well as their TV stations.
The sticking point to a deal could be management control. The NYT said industry sources doubted whether Viacom (VIA) chief Sumner Redstone and CBS (CBS) boss Mel Karmazin would be able to forge a working relationship.
The talks have come about because of a recent judgment by the Federal Communications Commission that allows a company to own two television stations in the same market under certain circumstances. CBS possesses 15 stations, with one purchase pending, while Viacom owns 19. The companies overlap in five cities.
Neither company would comment to the newspaper on the report.
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