Viacom Lead Independent Director Says Board Will Fight Any Attempts to Oust It
31 May 2016 - 9:02AM
Dow Jones News
By Joe Flint
Viacom Inc.'s board of directors won't exit without a fight.
Anticipating being pushed out by controlling shareholder and
former chairman Sumner Redstone, lead independent director Frederic
Salerno said in a letter to Viacom constituencies Monday that the
board is preparing for a legal battle to keep their seats because
they don't believe Mr. Redstone has the mental competency to act of
his own free will.
Mr. Redstone, who turned 93 years old on Friday, has yet to make
any such move to demand their removal.
But in the past week and a half, Mr. Redstone has overhauled his
holding company, National Amusements, and the trust that will
oversee his controlling stakes in Viacom and CBS Corp. when he dies
or is incapacitated. Viacom Chief Executive Philippe Dauman and
board member George Abrams were replaced on the trust and the
holding company's board with new stewards who have ties to Mr.
Redstone's daughter, Shari Redstone.
In the letter on behalf of the company's independent board
members, Mr. Salerno reiterated the board's belief that it is Ms.
Redstone, vice chairman of Viacom, who is behind Mr. Redstone's
recent decision to remove Mr. Dauman and Mr. Abrams. Ms. Redstone
has denied the accusations.
The Salerno letter reflects the independent directors'
expectation that their posts could be in jeopardy soon. A removal
attempt by the Redstone family "could happen any time," a person
close to the matter said Friday. And if it does, those directors
expect all six independent members will be ousted rather than just
a majority, the person said Sunday.
In the letter, Mr. Salerno said the recent speculation that Mr.
Redstone is preparing to remove some or all of the Viacom board
"would be completely inconsistent with Sumner's lifetime commitment
to an independent board and professional management for Viacom
after his incapacity or death." He added that "it would be equally
inconsistent with his stated judgment for many years that his
daughter, Shari, should not control Viacom or his other
companies."
While acquiescing to being dismissed would end the public
controversy and avoid litigation, the independent directors "feel
the responsibility to challenge in court what we honestly believe
would be legally flawed removals." They said it is also their
responsibility "to the legacy of a man we greatly admire and
consider a dear friend."
Joann S. Lublin contributed to this article.
Write to Joe Flint at joe.flint@wsj.com
(END) Dow Jones Newswires
May 30, 2016 18:47 ET (22:47 GMT)
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