Paramount Global has agreed to pay $122.5 million to settle a three-year lawsuit brought by several large investment funds. It believes the company pushed through the 2019 merger of Viacom and CBS at minority expense.
The settlement, disclosed in a financial filing by Paramount, marks the resolution of the lawsuit filed in Delaware Chancery Court.
Plaintiffs argue that Shari Redstone, the company’s controlling shareholder, Viacom, now chairman of Paramount Global, violated her fiduciary duty by filling Viacom board lists with friends and allies so she could push forward her merger agenda.
The lawsuit argues that the Viacom-CBS merger was enacted to protect the wealth of the Redstone family and the investment vehicle of National Amusements Inc., rather than the titular and file CBS shareholders. Under a nearly $12 billion deal, CBS, the most popular television network, joins smaller Viacom. which owns brands such as MTV, Nickelodeon, Comedy Central and Paramount Pictures.
CBS and Viacom were first merged in 2000, but the two companies split in 2006 when Shari’s father, Sumner Redstone, feared that the challenges facing CBS’s broadcasting business would slow the stock’s growth. It was a more prosperous company in the following years.
The Redstone family controls nearly 80% of the voting stock of both Viacom and CBS. The combined company was renamed Paramount Global in 2022.
A judge in Delaware must approve a settlement that arrived earlier this week, according to the filing. Several lawsuits filed by disgruntled Viacom shareholders were consolidated into a single court case.
CBS and Viacom were valued together at more than $30 billion before the merger was announced in mid-2019. But like other traditional media companies, Paramount Global has seen its stock come under pressure from the adjustment. base of financial markets
After the merger The company has a weak performance. together with the outbreak of the corona virus On Friday, Paramount Global’s Class B share price closed at $22.60 and was down 33% over the past year.