CBS and Viacom announced on Tuesday a merger agreement that will bring together the two companies, separated in 2006, and create a single entity called ViacomCBS, which they estimate will get about $ 28 billion in annual revenue.
According to a statement, the resulting firm will be “a leading global and cross-platform premium content company, with the assets, capabilities and scale to be one of the most important content producers and providers worldwide.”
CBS and Viacom rejoin under the umbrella of American media mogul Sumner Redstone, with the aim of coping with the competition of streaming platforms such as Netflix, HBO or the future Disney +.
“The joint venture will be an actor on a global scale, with leading positions in markets in the United States (USA), Europe, Latin America and Asia. It includes the largest television business in the US, with the highest proportion of audience through television and cable in all key demographic sectors” the note expressed.
The operation also includes the Paramount Pictures studios, “which have been a global producer and distributor of entertainment films for more than a century and that continues to be a global box office leader.”
President and CEO of Viacom, Bob Bakish, will lead the new company, while president and CEO of CBS, Joe Ianniello, will manage the division with CBS assets within the conglomerate within the same position.
“We combine our complementary assets and capabilities to become one of the few companies with the breadth and depth of content to shape the industry of the future,” said Bakish, quoted in the statement.
For his part, Ianniello congratulated the result of this merger and the opportunities it entails for both companies: “At CBS we have a great opportunity right now, creatively and operationally, and the Viacom portfolio will accelerate that progress.”
The resulting company will include CBS, Showtime, Nickelodeon, MTV, BET, Comedy Central or Paramount Networks channels, as well as one of the largest intellectual property libraries, with more than 140,000 television episodes and 3,600 movies, ranging from Star Trek to Mission Impossible.
It will also include 750 new series in production and ViacomCBS will become one of the companies that spend the most on content production: together, they have been more than 13,000 million dollars in the last year.
With over 4.3 billion subscribers worldwide, CBS produces content in 45 languages and is present in the United Kingdom, Argentina or Australia, among others, with a large presence among the Hispanic public.
Both companies, CBS and Viacom, belong almost 80% to National Amusements, the Sumner Redstone conglomerate, which has already guaranteed that the company will have sufficient votes to achieve the merger.
The merger, now depending on regulatory approval, is expected to close later this year.
It is not the first time that CBS and Viacom try to merge: they already tried it in 2016, but at that time CBS resisted due to lack of agreement on the assessment of Viacom, which originally acquired CBS in 2000 and from which it separated a few years after.