Viacom Directors Vow to Fight Any Board Removals, Leader Saysby and
Independent directors pursue minority investment in Paramount
Sumner Redstone may be weighing dismissal of CEO Dauman
Viacom Inc.’s independent directors will contest any possible effort by founder Sumner Redstone to remove board members from the media company, their leader said in an open letter on Monday.
Frederic Salerno, Viacom’s lead independent director, said he and fellow board member William Schwartz have tried without success to meet with Redstone in recent weeks. Redstone, who turned 93 Friday, has been reasserting his control over the owner of MTV and Paramount Pictures, triggering a legal battle. Last week, he removed Chief Executive Officer Philippe Dauman and director George Abrams from their roles overseeing a Redstone trust that will eventually control his empire.
“We will contest the purported removal if it comes, because we see that as our responsibility to the non-control shareholders of Viacom who own 90 percent of the equity of the company -- and to the legacy of a man we greatly admire and consider a dear friend,” Salereno wrote. “We can do no less than try to make sure that the fates of Viacom, its majority equity holders and Sumner’s legacy are ably represented on their behalf and impartially decided by the courts.”
Board members themselves aren’t happy with Viacom’s performance and are considering a “minority investment in Paramount that can contribute not only direct financial funding but commercial and strategic opportunities as well,” Salerno wrote. While that decision could lead to their removal if Redstone is found mentally competent to control the company, Salerno said they have an obligation to work on the company’s behalf.
Redstone’s lawyers have said he’s against the planned Paramount stake sale and have cited it as a reason the billionaire is unhappy with Dauman’s leadership.
Responding to questions Friday on whether Redstone planned to dismiss Viacom directors or CEO Dauman, a spokesman for the billionaire didn’t rule out such moves. “Sumner Redstone will make every decision with the same deliberation and consideration with which he removed Philippe Dauman and George Abrams as trustees, based on the best interests of shareholders,” a Redstone spokesman said in an e-mailed statement. He wasn’t more specific.