Jim Cramer and David Faber on Sumner Redstone's legacy

Описание: Sumner Redstone was a media mogul who built his family’s drive-in theater chain into a multibillion-dollar empire encompassing CBS and Viacom. In his 90s, he became the center of a jilted lover’s lawsuit that nearly cost his family his financial legacy. CNBC's David Faber and Jim Cramer revisit Redstone's legacy. Subscribe to CNBC PRO for access to investor and analyst insights: https://cnb.cx/2Vtntx6

Sumner Redstone, who died Wednesday at 97, built a sprawling media empire. It’s now his daughter’s decision if she wants to keep it.

The Redstone family holding company, National Amusements, owns 79.4% of the Class A voting common stock of ViacomCBS — the owner of cable TV networks, Paramount Pictures, Simon & Schuster and the CBS broadcast station. Eighty percent of NAI’s voting interested was controlled by Sumner Redstone. That now goes to a seven-person trust that puts Sumner Redstone’s daughter, Shari Redstone, in charge of the company. The trustees are Shari Redstone, her son Tyler Korff, David Andelman, Norman Jacobs, Leonard Lewin, Tad Jankowski and Jill Krutick. Shari owns the other 20% through a separate trust.

ViacomCBS has an enterprise value of about $35 billion and a market valuation of about $16 billion. That may sound large, but in today’s world, ViacomCBS is competing against behemoths.

Comcast (owner of NBCUniversal), AT&T (owner of WarnerMedia), Disney and Netflix all have enterprise values well over $200 billion. Amazon tops $1.5 trillion and Apple’s closing in on a $2 trillion market cap.

A series of legal maneuvers and corporate filings in 2016 paved the way for Shari Redstone to take over for Sumner as the decision-maker for National Amusements’s controlling stake in ViacomCBS. But it remains unclear if Shari has the same empire building aspirations as her father.

Sumner Redstone successfully acquired Paramount in 1994 for $10 billion. He then acquired CBS in 1999 for $37.3 billion in what was the biggest media merger ever at the time.

You don’t have to be a math major to figure out something went wrong with that deal, given ViacomCBS’s value in 1999 is higher than it is today. The company split into two – Viacom and CBS – in 2006, which, in hindsight, seems like a mistake. While CBS flourished under CEO Les Moonves, Viacom eventually floundered as MTV, Comedy Central and VH1 lost cultural relevance through the 2000s. Both companies found themselves undersized in recent years, eventually culminating in a December merger that reunited them as ViacomCBS, with Shari Redstone’s blessing.

Shari Redstone pushed Viacom and CBS to merge and has had her eye on getting even bigger, according to people familiar with her thinking. But ViacomCBS’s next target is unclear, especially as long quarantines and 10% unemployment erode traditional TV advertising dollars while pushing audiences toward less expensive streaming options. ViacomCBS is moving ahead with its own streaming ambitions, adding content to the already-existing CBS All Access and officially rebranding it in early 2021.



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