Latest from Next TV in Dooley

Bakish to Receive $10M Package as Head of New Viacom Unit

Mike Farrell — Tue, 01 Nov 2016 21:05:00 +0000

Bob Bakish may be Viacom’s acting CEO for only a short period, but the long-time company executive has secured a long-term deal as CEO of the programmer’s newest unit – Viacom Global Entertainment Group – that could net him nearly $10 million per year over the next three years.

Bakish, who has been with Viacom since 1997 and most recently served as head of its international operations, agreed to become the company’s acting CEO, replacing Thomas Dooley effective Nov. 15. Also as part of that announcement, Bakish was named CEO of a new reorganized unit – Viacom Global Entertainment Group – which will include Viacom’s International Media Networks division and its Music and Entertainment Group, which houses MTV, Comedy Central, VH1, Spike, Logo, TV Land and CMT.

According to an 8-K statement filed with the SEC Tuesday, Bakish will serve as CEO of Global Entertainment through Oct. 30, 2019. According to the document, Bakish’s annual base salary will be $2.75 million and he will be eligible for an annual cash bonus with a target value of $3.5 million. Bakish also will be eligible to receive annual equity grants with a target value of $3.25 million.

As acting CEO, Bakish’s salary will be the greater of $2.5 million per year or $500,000 per month, pro-rated for partial months of service. That base compensation will be in addition to what he receives as CEO of the Global Entertainment Group. He will not be entitled to any bonus or equity compensation as acting CEO of Viacom and will serve in that role until a permanent CEO is named or upon completion of any business combination between Viacom and CBS. As reported, Viacom is currently evaluating a possible merger with its former corporate sister CBS.

Viacom Names Bakish Acting CEO

Mike Farrell — Mon, 31 Oct 2016 21:05:00 +0000

Viacom named long-time executive Robert Bakish as acting president and CEO, taking over for the current temporary chief – Thomas Dooley – effective Nov. 15.

Bakish has been with Viacom since 1997, the past 10 years as head of the programmer's international business. In his new role Bakish will focus on investing in and developing new content, expanding distribution and pursuing strategic opportunities om Viacom’s core businesses.

In addition Viacom said Bakish also will become president and CEO of Viacom Global Entertainment Group, a new unit that will house Viacom’s International Media Networks division with the company’s Music and Entertainment Group, which includes MTV, Comedy Central, VH1, Spike and Logo. In addition, TV Land and CMT will join the Global Entertainment Group portfolio under Bakish.

Viacom’s Kids and Family Group will be renamed the Nickelodeon Group and BET Networks, home of leading brands among African American adults, will continue to function as a dedicated and separate group.

“I look forward to working closely with the board of directors, senior management and our talented and hardworking people around the world to realize the full potential of Viacom’s outstanding assets for the benefit of our audiences, partners and stockholders,” Bakish said in a statement. "Content is the lifeblood of our business and my near-term focus will be to nurture our creative output and brands, ensuring they remain distinctive, differentiated and powerful in an increasingly competitive global media landscape.”

Bakish will be the third Viacom CEO since August, when long-time chief Philippe Dauman stepped down after a heated battle with his former mentor and Viacom’s largest shareholder, Sumner Redstone. Dauman was replaced by Dooley, himself a long-time lieutenant and Viacom employee, who had initially agreed to stay in the top spot until Sept.30. But shortly after that announcement, Dooley, who was also being considered as a permanent CEO replacement, dropped out of the running, saying he would leave the company on Nov. 15.

The timing of that announcement came around the time Redstone and the rest of Viacom’s board of directors were considering whether a merger with its former corporate sister – CBS – would make sense. Earlier this month, Viacom’s board of directors appointed a special committee to investigate whether a merger would make sense.

Bakish joined Viacom in 1997 and has held leadership positions throughout the organization, most recently serving as president and CEO of Viacom International Media Networks (VIMN) and its predecessor company, MTV Networks International, since 2007. In this role, he was responsible for all of Viacom’s media networks and related businesses outside the United States.

“Bob’s record of innovation and achievement at Viacom, combined with his strategic vision and leadership ability, make him highly qualified for this position,” said Viacom chairman Tom May in a statement. “We are determined to move forward aggressively to strengthen Viacom for the future, whether as a stand-alone company or in a potential combination with CBS. There is a great deal of opportunity ahead and Bob is a superb leader to drive this effort, fully empowered to take the actions necessary to position Viacom for success.”

Bakish’s appointment had been expected for several days. The long-time executive also received the blessing of vice chair Shari Redstone.

“To be a successful leader in the industry today requires continuous flexibility, a global perspective, a commitment to innovation and an embrace of change,” Shari Redstone said in a statement. “Bob is an exemplary forward thinker who embodies these traits, embraces disruption and brings teams along with him. Under his leadership our great employees will be supported in their efforts to bring world class content and experiences to our audiences, while we continue to drive improvements in Viacom’s financial performance.”

Viacom Sets $1.3B Bond Offering

Mike Farrell — Fri, 30 Sep 2016 14:28:00 +0000

Shortly after it said it received a letter from its controlling shareholder urging it to investigate a possible reunion with former corporate sister CBS, Viacom said it will issue $1.3 billion in debt to help pay off some of its existing obligations.

The move was widely expected. Viacom said earlier in the month when it announced plans to slash its dividend that it was also planning to issue debt.

National Amusements, the theater chain that holds Sumner Redstone’s 80% voting interest in Viacom, sent a letter to the cable programmer’s board of directors Thursday asking them to look into a merger with CBS. Viacom and CBS were once part of the same company, splitting up in 2006 in an effort to unlock value.

Viacom’s board said it will appoint a special committee of independent directors to investigate the matter.

The National Amusements letter caps what has been a volatile few months for Viacom. In May, Redstone ousted then-CEO Philippe Dauman from the trust that would control his shares in the event of his death or incapacitation. That set off a flurry of lawsuits and accusations by Dauman that Redstone’s daughter – and Viacom vice chair – Shari Redstone was unduly influencing her father. Dauman and Redstone settled their suits in August and Dauman agreed to step down as executive chairman and CEO. Interim CEO Thomas Dooley, a former candidate for the CEO spot – said earlier this month that he would leave in November.

The debt issuance will be in two tranches -- $400 million in 2.25% senior notes due 2022 and $900 million in 3.45% senior notes due 2026. Viacom said it expects to close the sale of the senior notes on Oct. 4.

Viacom said it plans to use the proceeds from the offerings to repay $400 million of its 2.5% senior notes due this December 2016, and $500 million of its 3.5% senior notes due April 2017 and borrowings under its commercial paper program.

The joint book-running managers for the offering are Citigroup Global Markets Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan Stanley & Co. LLC.

Viacom Slashes Dividend, Dooley Departs

Mike Farrell — Wed, 21 Sep 2016 14:13:00 +0000

Viacom’s board of directors moved to slash its quarterly dividend on Wednesday, adding that interim CEO Tom Dooley has opted to leave the troubled media company.

Viacom has been searching hard for ways to cut costs and the dividend reduction was widely expected by analysts. By cutting the payout in half to 20 cents per share from about 40 cents per share, Viacom saves about $300 million.

Dooley, who has worked for Viacom for more than 30 years, agreed to step up from chief operating officer to interim CEO after executive chairman and CEO Philippe Dauman resigned. Dooley had been a trusted lieutenant of Dauman’s and will remain with Viacom through Nov. 15 to help in the transition. Viacom is in the process of finding a permanent CEO.

“While this was a difficult decision for me, I have great admiration for our new board and I feel that they will be best able to execute on their vision for the company in the hands of a new president and CEO,” Dooley said in a statement. “I am certain that the board will make the most of the company’s extraordinary potential. I want to thank Sumner, Shari and the members of the board for the opportunities they have provided me. I look forward to working with them to deliver Viacom into the hands of new leadership in excellent shape and poised for a remarkable future.”

In addition to the dividend reduction, Viacom said it would also tap the debt markets to improve liquidity and financial flexibility.

“The board believes Viacom has a product strategy that is among the best in the industry. The steps we are taking will make the company financially stronger and more flexible and will position Viacom to take advantage of future growth opportunities,” said Viacom chairman Tom May said in a statement. “I am pleased that Tom Dooley has agreed to stay on as Interim president and CEO through November 15 to allow the Board to conduct an orderly succession process.’’

Dooley stepped in as interim CEO in August after a months-long battle between Dauman and former chairman and largest shareholder Sumner Redstone that began after the former CEO tried to sell a minority interest in movie studio Paramount Pictures. That move, since shelved, raise Redstone’s hackles enough to remove Dauman from the trust that would control Redstone’s shares after his death or incapacitation, and resulted in a flurry of lawsuits between the two.

Those suits were settled in August when Dauman agreed to step down, reaping more than $100 million in stock options and severance in the meantime.

“I have been energized by the passion, commitment and ideas put forward by our newly-expanded board and members of Viacom’s senior team, Viacom vice chair Shari Redstone said in a statement. “While there is more work to do, the actions announced today are an important first step towards realizing the value of Viacom’s exceptional assets and positioning the company for the future. I also want to thank Tom Dooley for his service and his willingness to stay on through this transition period.”

Viacom added that it expects adjusted diluted earnings per share for the fiscal fourth quarter will be in the range of 65 cents to 70 cents. This revision accounts for a programming impairment charge of $115 million in its filmed entertainment segment in its fiscal fourth quarter related to the expected performance of an unreleased film; reported earnings per share are expected to be $0.55 to $0.60, primarily reflecting severance expenses incurred as a result of the settlement agreement; and

Viacom will provide additional information regarding its fourth quarter and full-year results and business outlook during its regular quarterly earnings call.

Be Careful What You Wish For

Mike Farrell — Mon, 22 Aug 2016 17:30:00 +0000

Sumner Redstone once again got his way in the continuing soap opera that is Viacom Inc., with long-time CEO Philippe Dauman throwing in the towel in their months long battle for control of the programmer, agreeing to step down as CEO immediately and give up his executive chairman spot on Sept. 13. Dauman will have to lick his wounds with the help of an estimated $72 million severance package. He also gets to pitch his plan to sell 49% of Paramount Pictures to the board of directors, but given that Redstone strongly objected to the Paramount sale in the first place, it is a long shot.

On the surface, the outcome seems to be as good as could be expected – Redstone gets rid of what he believed was one of the big reasons behind Viacom’s recent decline, and Dauman gets to cash another big check (it has been reported that he has reaped about $400 million in compensation in the past 10 years as Viacom CEO). But now that the deck is cleared – curiously, chief operating officer Tom Dooley, Dauman’s right hand man for more than a decade,will take over as interim CEO at least until Sept. 30, the end of the fiscal year -- the real work begins. Dooley will have a shot at the permanent CEO spot, but it is likely that others may also vie for the role – former DreamWorks Animation CEO Jeffrey Katzenberg, former Disney COO Tom Staggs, and 21st Century Fox COO Chase Carey have all been named as possible candidates.

But no matter who takes on the unenviable task of righting the Viacom ship, the eyes of Wall Street and the rest of the entertainment community are squarely on Redstone and his daughter, Viacom vice chairman Shari, who initiated the shakeup at the programming juggernaut. Getting rid of Dauman – something that investors and Wall Street analysts have been hinting at for a while – was just the beginning of what could be a very long road.

And already analysts are offering some possible paths to a solution.

MoffettNathanson media analyst Michael Nathanson said in a blog post last Friday that while the choice of Dooley as interim CEO was curious – he wondered ow much of a change-agent Dooley could be given his history with the company – a CBS merger is more important than ever.

But Nathanson added that any accretion that could have been assumed in past years in such a deal has all but been eliminated, making any stock-for-stock deal less palatable for CBS shareholders. Assuming a 20% premium to Viacom’s share price, an all-stock buy-out of Viacom and $400 million in cost synergies would be just 6% accretive to CBS’ shareholders. Nathanson added that Viacom also needs to hire a savvy programming CEO and focus on stopping the talent drain of the past few years. But again, if it were that easy, Dauman would have done it years ago.

Morgan Stanley media analyst Ben Swinburne suggested in a note to clients that Viacom should circle the wagons around its kids’ content, focusing on beefing up its Nickelodeon channel and placing at least a short-term moratorium on SVOD licensing deals for kids’ shows. Swinburne also suggested that Viacom should consolidate its nearly 20 networks down to a core of five or six – Nickelodeon, MTV, Comedy Central, BET and Spike. That makes a lot of sense, given that one of the big complaints from distributors is the sheer number of Viacom channels. For what it’s worth, Swinburne noted that Viacom itself has said it drives about 85% of affiliate revenue from its top six networks and he estimated that the vast majority of segment profit comes from that core as well.

Swinburne also called for a reduction in the ad load at Viacom’s channels, given that its core millennial audience already has a low tolerance for advertising.

“In our view, Nickelodeon is the crown jewel and has seen some content success of late on both Nick and Nick Jr.,” Swinburne wrote. “We argue building this network(s) is the key to long-term durability of the company, and Viacom may need to (at least for now) leave its content exclusive to its networks and apps.”

BTIG media analyst Rich Greenfield, a long-time critic of Viacom and Dauman, said the CEO’s departure presents an opportunity to sell the company outright.

“We believe Viacom is now in play,” Greenfield wrote in a blog post Monday.

He pointed to reports that said one of the potential buyers of the 49% interest in Paramount Pictures, China-based conglomerate Dalian Wanda, had wanted to purchase the entire studio for about $10 billion. Greenfield wrote that Dalian Wanda or others could instead buy all of Viacom and sell off what they don’t want.

Greenfield’s also is a backer of merging with CBS – he said talent loves CBS chairman and CEO Les Moonves, while he believes Dauman is “despised by his employees, other senior media executives and investors…” Attracting new talent – both creative and management – would help put Viacom back on track. And perhaps more importantly, with Moonves at the helm the perception of the cable programmer would change dramatically.

“Investors have faith in Moonves, having witnessed his remarkable run at CBS, combining a culture that breeds creativity with a continuous stream of financial engineering to drive shareholder returns,” Greenfield wrote.

Faith is something that Viacom has lacked in the past few years and even in the wake of Dauman’s departure, isn’t something that Viacom shareholders are used to. Already the stock price, which rose 1.5% on Friday when news of the changes first surfaced, is beginning to fall back. The stock was down as much as 5% in early trading Monday and by early afternoon was priced at $41.96 each, down 3.5% or about $1.53 per share.

Viacom Extends Dooley Employment Pact

Mike Farrell — Thu, 17 Mar 2016 13:30:00 +0000

Viacom said Thursday that it has extended its employment agreement with executive vice president and chief operating officer Tom Dooley two years through Dec. 31, 2018. His previous deal was set to expire on Dec. 31, 2016.

Dooley is a veteran of the media conglomerate and has been a trusted lieutenant of executive chairman and CEO Philippe Dauman.

“Tom is an outstanding executive with a history of remarkable accomplishment at Viacom,” Dauman said in the statement. “He has done an excellent job in helping to reorient Viacom’s operations to succeed in the changing media environment, spearheading the creation of the industry’s best-in-class data-focused advertising products, and driving effectiveness and efficiency throughout the company. His continued leadership by my side will be a key factor in Viacom’s success in the years ahead.”

Dooley was named chief operating officer of Viacom 2010 and has served on Viacom’s Board since 2006. Prior to becoming COO, Dooley was served as chief administrative officer in 2006, adding the title of chief financial officer in 2007. Previously, Dooley was Deputy Chairman of the former Viacom Inc., a predecessor of the Company, and also served as a member of the Board of that company from 1996 to 2000. He first joined Viacom in 1980.