CEO at Viacom Ousted, Redstones Reassert Power
Sumner Redstone along with Shari his daughter reasserted control on Thursday of Viacom resolving the crisis that has gripped the media conglomerate by arranging for the exit of their renegade CEO, president and chairman Philippe Dauman in exchange for a payout of $72 million.
The holding company of the Redstones’ National Amusements, gave its approval of the deal earlier this week and it was then approved by the corporate board of Viacom Thursday night.
This resolution will settle a number of legal proceedings in courtrooms across three states where Viacom and Dauman were battling the Redstones for the voice in determining the company’s fate.
This deal, which still had not been announced late Thursday night, was described by people who were involved with the proceedings. Those people spoke on the condition they will not be identified.
Thomas Dooley a veteran executive at Viacom, currently the COO of the company, will be named the interim president and CEO through September 30, which is the last day of the fiscal year of the company.
Dauman is to continue as the corporate board’s executive chairman through September 13 and will be given the opportunity to present a proposal to the board at Viacom to sell a major stake in Paramount to an investor from China.
The board will have another five approved members by the Redstone family and is expected to reject any proposal that Dauman presents regarding Paramount.
Five other members of the board that have ties to Dauman are to resign or will cycle off as the terms of their time on the board expire.
Though the company is traded publicly, National Amusements is the owner of 10% of the equity in Viacom and 80% of the voting shares in the company. National Amusements already kicked Dauman from its board.
For years, Dauman has been a trusted advisor, chief protégé and lawyer of Sumner Redstone. He cited what he called Redstone’s support when proposing the sale of Paramount. However, representatives of Redstone said he opposed the sale and then Dauman later said he misunderstood.
Redstone objected as well to the drop in stock price of Viacom as it lost close to 40% over the past three years.
In addition, the critics of Dauman both in and out of the company say the executive ranks have suffered brain damage and a huge loss in creative talent.