16 Apr

Can CBS and Viacom Make a Deal This Time?

WRITTEN BY Rachel Gunter

Viacom averted potential revenue loss of $1.0 billion

The talks to combine CBS (CBS) and Viacom (VIAB) (VIA) could restart any time. The New York Post reported last month that CBS was preparing to approach Viacom with a takeover offer. Viacom may have become a more attractive takeover target for CBS, as it has settled its programming dispute with AT&T (T). The settlement averted the blackout of Viacom channels on AT&T-owned satellite broadcaster DIRECTV. The settlement also averted a potential loss of around $1.0 billion in programming fee revenue for Viacom.

After clearing the programming standoff with AT&T, Viacom reaffirmed its guidance for fiscal 2019 domestic affiliate revenue growth. Viacom said in February that it was expecting its domestic affiliate revenue to grow in the low-single-digit percentage in fiscal 2019.

Can CBS and Viacom Make a Deal This Time?

Ready to put your morning scrolling to use? Sign up for Bagels & Stox, our witty take on the top market and investment news straight to your inbox! Whether you’re a serious investor or just want to be informed, Bagels & Stox will be your favorite email.

Sharing leading slots to dominate merger talks

CBS and Viacom have common ownership. Both companies are controlled by the family of Sumner Redstone through an entity called National Amusements. An attempt last year to merge CBS and Viacom sparked tensions, leading to CBS suing the Redstone family. CBS and the Redstone family later reached a settlement, with the Redstone family agreeing not to pursue a merger between CBS and Viacom for about two years. The settlement didn’t prohibit CBS and Viacom directors from discussing a merger of the companies on their own. A major sticking point in the previous merger attempt was who would become the chief executive officer of the combined company. Reopened merger talks between CBS and Viacom are expected to center on the CEO issue.

CBS reported revenue growth of 3.0%

CBS made a profit of $561 million on revenue of $4.0 billion in the fourth quarter, which ended in December. Revenue increased 3.0% YoY. Revenue was nearly flat year-over-year at Viacom in the December quarter. Comcast (CMCSA) and Charter Communications (CHTR) recorded revenue growth of 6.0% and 26% YoY, respectively, in the December quarter.

Latest articles

JCPenney (JCP) is slated to announce its results for the first quarter of fiscal 2019, which ended on May 4, on May 21.

17 May

What to Know about the US-China Trade War

WRITTEN BY Mayur Sontakke, CFA, FRM

The key point of contention in the US-China trade dispute is the large trade deficit the United States runs against China.

On May 16, the Labor Department reported jobless claims for last week. Initial jobless claims fell by 16,000 to 212,000 for the week ended May 11.

Jeffrey Gundlach recommended investors take advantage of the volatility in interest rates at the recent Sohn Conference.

Tesla (TSLA) has fallen 4.2% as of 11:55 AM EDT on May 17. While US equity markets opened in the red today, they've recouped their losses.

According to Reuters, on May 16, Vale (VALE) told prosecutors that a dam was at risk of rupturing at its Gongo Soco mine.

172.31.1.77