CBS CBS Corp

By Joshua Jamerson 

National Amusements Inc., Sumner Redstone's family holding company, on Thursday publicly called for the boards of the companies it controls -- Viacom Inc. and CBS Corp. -- to explore a merger.

In a letter to the companies disclosed in a press release, National Amusements said it believes a merger could "allow the combined company to respond even more aggressively and effectively to the challenges of the changing entertainment and media landscape."

National Amusements said the optimal deal would be an all-stock transaction. Neither Sumner nor Shari Redstone would vote as directors on the matter or participate in any of the related deliberations. David R. Andelman, a director on the CBS board, also won't participate.

But National Amusements said it won't support an acquisition of either Viacom or CBS by a third party. It also won't support a transaction in which National Amusements would have to surrender its controlling position in either company, or a deal in which it doesn't control the combined company.

The move confirms reports that Mr. Redstone's daughter, Shari, is moving to potentially undo the last big strategic move of her ailing father.

Coming a decade after Mr. Redstone split the two companies from each other, the proposed reunion would be effectively an admission that the split -- intended to free Viacom's then fast-growing cable channels from the drag of CBS's old-school broadcast assets -- didn't pan out as intended.

Ms. Redstone's call on a potential CBS-Viacom marriage comes weeks after she cemented a powerful role in her family's $40 billion media empire. Mr. Redstone, who is 93 years old and in ill health, remains on the board of National Amusements, though he stepped down from his role as chairman of both CBS and Viacom earlier this year amid questions about his mental capacity.

Shares of Viacom rose 0.9% to $36.90 in premarket trading, while CBS stock rose 0.4% to $54.39.

Write to Joshua Jamerson at joshua.jamerson@wsj.com

(END) Dow Jones Newswires

September 29, 2016 08:38 ET (12:38 GMT)

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