Paramount Global will pay $122.5 million to settle a lawsuit claiming the 2019 CBS-Viacom merger was unfair to shareholders. This, according to a Securities and Exchange Commission Admission Friday, subject to long-term agreement and approval by the Court of Chancery of Delaware.
The lead plaintiff in the litigation, which also named Shari Redstone and the Redstone family of national entertainment as defendants, was the California Public Employees’ Retirement System. [“CalPERS”], The main allegation was that Shari Redstone pursued the merger to consolidate power and become a corporate magnate on a par with her late father, Summer Redstone.
Paramount CEO Bob Bakish was dropped from the suit in the same December 2020 decision allowed the trial to proceed, The lawsuit claimed that Viacom’s board accepted the low price for the merger in order to secure Redstone’s governance preferences, which included that the company would be led by Bakish and his executive team.
In that December 2020 ruling, Delaware Chancery Court Vice Chancellor Joseph Sleights said it was reasonable to infer from the plaintiffs’ claims that the December 2019 merger was “not entirely fair” and that Redstone used it to “exercise its control of Viacom”. To strengthen”. and CBS at the expense of Viacom minority shareholders.”
In the same statement, Slights said that “Plaintiffs allege that the will of the assistants who served on Viacom’s transaction committee allowed Ms. Redstone to dominate her decision-making, they are not responsible for Ms. Redstone’s Viacom/CBS combination.” Provided helpful tools in tireless effort to further his interests.
little added, In another decision in January of 2021 Affirming CBS shareholders’ ability to sue, the claims “allow a reasonable conclusion that Viacom’s acquisition of CBS was motivated not only by Ms. Redstone’s concerns, but also by her concern about Viacom’s viability, But they also had a desire to buy NAI after their consolidation.”
Redstone insisted on merging the companies that his father had built over the decades. Sumner Redstone passed away in August 2020 at the age of 97.
The CBS–Viacom merger created a new company led by Bakish called Viacom CBS, with Redstone serving as non-executive chairman. The company changed its name to Paramount Global last year.
Paramount also notes that it is also in litigation with some of its insurers. It added that “pending realization of any such insurance proceeds, the company shall advance moneys due for settlement.”
Shares of Paramount Global closed at $22.59, down from $25.25 in early February.
