As his reported ailing health and continued questions surrounding his succession plans for Viacom continue to mount, Viacom chairman Sumner Redstone issued a statement Wednesday confirming plans to put his controlling interest in the media giant into a separate trust after he dies.
The 92-year-old mogul has been said to be in failing health for months. Reports in the NY Times and The Wall Street Journal Wednesday reiterated the health concerns, with the Journal claiming that after a series of small strokes, Redstone’s ability to run the company may be declining. The chairman, usually a regular presence during earnings conference calls and annual meetings has sat the last few of those events out.
The Journal added that Viacom has stressed that Redstone remains active in the business and regularly meets with executives. But the strokes have limited his ability to talk.
It had been believed that Redstone had created a trust that would be managed by seven independent individuals – including his daughter, National Amusements president and Viacom board member Shari Redstone and Viacom CEO Philippe Dauman. In a statement, Redstone confirmed those plans.
“As I have said clearly in the past, the transfer of what I created -- my controlling interest in Viacom and CBS -- to an independent trust that I set up decades ago will ensure that the assets will be professionally managed for the benefit of all shareholders. Recent speculation about personal agendas has only confirmed for me the wisdom of my decision,” Redstone said in a statement.
Viacom has been hit hard as ratings have declined, the ad market has cratered and more and more viewers are migrating to over-the-top and online video services. Because its networks skew the youngest –including Nickelodeon, MTV and Comedy Central, Viacom has suffered the brunt of criticism. In the past 12 months, its stock has declined about 37%.
Dauman has weathered his share of criticism as well, and the Journal story said some board members have pushed for his ouster. In the statement, Redstone continued to back the CEO, a long-time friend and confidant.
“Philippe is my long-time friend and partner,” Redstone said in the statement. “He continues to have my unequivocal support and trust, which he has earned over our many years together. He is out in front navigating an unprecedented level of change in the industry and he has articulated for me, for the Viacom board and for his management team, a smart, innovative and sustainable path to success. We are both long-term thinkers and I am more confident than ever that he is on the right track.”
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