CBS Corp.’s $40 Billion Merger with Viacom

The Special Committee of CBS’s Board of Directors is being advised by Centerview Partners LLC and Lazard Frères & Co. LLC as its financial advisors and by Paul, Weiss, Rifkind, Wharton & Garrison LLP as its legal counsel. The Special Committee of Viacom’s Board of Directors is being advised by LionTree Advisors LLC and Morgan Stanley & Co. LLC as its financial advisors and by Cravath, Swaine & Moore LLP as its legal counsel. Viacom is being advised by Shearman & Sterling LLP. NAI is being advised by Evercore as its financial advisor and by Cleary Gottlieb Steen & Hamilton LLP as its legal counsel. Latham & Watkins LLP represented LionTree Advisors and Morgan Stanley, financial advisors to the Special Committee of Viacom’s Board of Directors. Kirkland & Ellis is representing Centerview Partners LLC and Lazard Frères & Co. as financial advisors to the Special Committee of CBS Corp’s. Board of Directors on CBS Corp’s. Hughes Hubbard is representing CBS Corp.

CBS (NYSE: CBS.A, CBS) and Viacom (NASDAQ: VIA, VIAB), two of the world’s leadingentertainment companies,  entered into a definitive agreement to combine in an all-stock merger, creating a combined company with more than $40 billion in revenue.

The combined company, ViacomCBS Inc., will be a leading global, multiplatform, premium content company, with the assets, capabilities and scale to be one of the most important content producers and providers in the world. The combined company will be a scale player globally, with leadership positions in markets across the U.S., Europe, Latin America and Asia.

In addition, the combined company will possess a portfolio of fast-growing direct-to-consumer platforms, including both subscription and ad-supported offerings. It will also include a major Hollywood film studio, Paramount Pictures, which has been a producer and global distributor of filmed entertainment for more than a century and continues to be a global box office driver.

Taken together, these distinct strengths will accelerate CBS and Viacom’s ability to deliver an array of compelling content to important and diverseaudiences across both traditional and emerging platforms around the world.

The merger agreement was approved by the Boards of Directors of both CBS and Viacom by unanimous vote of those present, upon the unanimous recommendations of the Special Committees of the CBS and Viacom Boards of Directors, respectively. Existing CBS shareholders will own approximately 61% of the combined company and existing Viacom shareholders will own approximately 39% of the combined company on a fully diluted basis. Under the terms of the merger agreement, each Viacom Class A voting share and Viacom Class B non-voting share will convert into 0.59625 of a Class A voting share and Class B non-voting share of CBS, respectively.

NAI, which holds approximately 78.9% and 79.8% of the Class A voting shares of CBS and Viacom, respectively, has agreed to deliver consents sufficient to assure approval of the transaction. More than two-thirds of the CBS directors unaffiliated with NAI (and all of those unaffiliated directors who voted on the transaction) have approved the transaction, as required in order to permit NAI to consent to the transaction under the terms of the 2018 settlement agreement entered into among CBS, NAI and certain other parties thereto.

The Paul, Weiss team included corporate partners Robert Schumer, Ariel Deckelbaum, Michael Vogel, John Kennedy, Kelley Parker and Patrick Campbell and counsel Patricia Vaz de Almeida and Frances Mi; litigation partners Brad Karp, Jaren Janghorbani, Bruce Birenboim, Lewis Clayton and Rick Rule and counsel Daniel Mason; tax partners David Sicular and Lindsay Parks; employee benefits partner Lawrence Witdorchic and counsel Jarrett Hoffman; intellectual property partner Chuck Googe; real estate partner Peter Fisch; personal representation partner Alan Halperin; antitrust counsel Marta Kelly; entertainment counsel Carolyn Casselman; environmental counsel William O’Brien; and international trade counsel Richard Elliott.

The Cravath team is led by partners Faiza J. Saeed, Damien R. Zoubek and Keith Hallam and includes associates Daniel J. Cerqueira, Sanjay Murti, Jin-Kyu Baek, Sandeep S. Chhabra, Ana Drmanovic, Kyra E. Ferber and Maria Ricaurte on M&A matters; partners Eric W. Hilfers and Jonathan J. Katz and associates Matthew J. Bobby, Sally Ye and Anna Mikaelyan on executive compensation and benefits matters; partners Stephen L. Gordon and Lauren Angelilli and associates Richard Bohm and Rory M. Minnis on tax matters; partner David J. Kappos and associates Kathryn-Ann Stamm and F. Adam Abulawi on intellectual property matters; partner Matthew Morreale on environmental matters; and practice area attorney Brian M. Budnick on real estate matters.

The Shearman & Sterling team advising Viacom included Creighton Condon (Picture), Daniel Litowitz, Grace Jamgochian, Kotoe Oshima, Adam Hurwitz, Nathan Tasso, Michael Shulman, Adam Sternberg, Denise M. Grant, John J. Cannon, Matthew Behrens, Stephen T. Giove, Lona Nallengara, Lisa Jacobs, Daniel Yao, James Webber, Caroline Préel, Kelsey Scribner, and Brian Bishop.

Latham & Watkins LLP represented LionTree Advisors and Morgan Stanley with a corporate deal team led by New York partners Adel Aslani-Far and David Kurzweil, with associate Lydia Lee.

The Cleary M&A team includes partners Christopher Austin and Paul Tiger and associates Max Wade, Kelsey MacElroy, and Teddy Nimetz.  Partner Meredith Kotler provided litigation advice. The tax team includes partner Meyer Fedida and counsel J.J. Gifford. The trust & estates team includes counsel Heide Ilgenfritz. The executive compensation team includes partner Arthur Kohn and counsel Mary Alcock.  Counsel Andrea Basham is providing securities law advice. All lawyers are based in New York.

The Kirkland team was led by transactional partners Eric Schiele and James Hu and associate Brandon Remington.

The HHR team includes Chuck Samuelson, Ken Lefkowitz, Jenny Graham, Spencer Harrison, Gary Simon, Alex Rahn, Ben Ferziger and Giorgia Nagalli.

Involved fees earner: Mary Alcock – Cleary Gottlieb Steen & Hamilton; Christopher Austin – Cleary Gottlieb Steen & Hamilton; Andrea Basham – Cleary Gottlieb Steen & Hamilton; Meyer Fedida – Cleary Gottlieb Steen & Hamilton; J.J. Gifford – Cleary Gottlieb Steen & Hamilton; Heide Ilgenfritz – Cleary Gottlieb Steen & Hamilton; Arthur Kohn – Cleary Gottlieb Steen & Hamilton; Meredith Kotler – Cleary Gottlieb Steen & Hamilton; Kelsey MacElroy – Cleary Gottlieb Steen & Hamilton; Edward Nimetz – Cleary Gottlieb Steen & Hamilton; Paul Tiger – Cleary Gottlieb Steen & Hamilton; Max Wade – Cleary Gottlieb Steen & Hamilton; Adam Abulawi – Cravath Swaine & Moore; Lauren Angelilli – Cravath Swaine & Moore; Jin-Kyu Baek – Cravath Swaine & Moore; Matthew Bobby – Cravath Swaine & Moore; Richard Bohm – Cravath Swaine & Moore; Brian Budnick – Cravath Swaine & Moore; Daniel Cerqueira – Cravath Swaine & Moore; Sandeep Chhabra – Cravath Swaine & Moore; Ana Drmanovic – Cravath Swaine & Moore; Kyra Ferber – Cravath Swaine & Moore; Stephen Gordon – Cravath Swaine & Moore; Keith Hallam – Cravath Swaine & Moore; Eric Hilfers – Cravath Swaine & Moore; David Kappos – Cravath Swaine & Moore; Jonathan J. Katz – Cravath Swaine & Moore; Anna Mikaelyan – Cravath Swaine & Moore; Rory Minnis – Cravath Swaine & Moore; Matthew Morreale – Cravath Swaine & Moore; Sanjay Murti – Cravath Swaine & Moore; Maria Ricaurte – Cravath Swaine & Moore; Faiza Saeed – Cravath Swaine & Moore; Kathryn?Ann Stamm – Cravath Swaine & Moore; Sally Ye – Cravath Swaine & Moore; Damien Zoubek – Cravath Swaine & Moore; Benjamin Ferziger – Hughes Hubbard & Reed; Jennifer Graham – Hughes Hubbard & Reed; Spencer Harrison – Hughes Hubbard & Reed; Kenneth Lefkowitz – Hughes Hubbard & Reed; Giorgia Nagalli – Hughes Hubbard & Reed; Alexander Rahn – Hughes Hubbard & Reed; Charles Samuelson – Hughes Hubbard & Reed; Gary Simon – Hughes Hubbard & Reed; James Hu – Kirkland & Ellis; Brandon Remington – Kirkland & Ellis; Eric Schiele – Kirkland & Ellis; Adel Aslani-Far – Latham & Watkins; David Kurzweil – Latham & Watkins; Lydia Lee – Latham & Watkins; Bruce Birenboim – Paul Weiss Rifkind Wharton & Garrison; Patrick Campbell – Paul Weiss Rifkind Wharton & Garrison; Carolyn Casselman – Paul Weiss Rifkind Wharton & Garrison; Lewis Clayton – Paul Weiss Rifkind Wharton & Garrison; Ariel Deckelbaum – Paul Weiss Rifkind Wharton & Garrison; Richard Elliott – Paul Weiss Rifkind Wharton & Garrison; Peter Fisch – Paul Weiss Rifkind Wharton & Garrison; Chuck Googe – Paul Weiss Rifkind Wharton & Garrison; Alan Halperin – Paul Weiss Rifkind Wharton & Garrison; Jarrett Hoffman – Paul Weiss Rifkind Wharton & Garrison; Jaren Janghorbani – Paul Weiss Rifkind Wharton & Garrison; Brad Karp – Paul Weiss Rifkind Wharton & Garrison; Marta Kelly – Paul Weiss Rifkind Wharton & Garrison; John Kennedy – Paul Weiss Rifkind Wharton & Garrison; Daniel Mason – Paul Weiss Rifkind Wharton & Garrison; Frances Mi – Paul Weiss Rifkind Wharton & Garrison; William O’Brien – Paul Weiss Rifkind Wharton & Garrison; Kelley Parker – Paul Weiss Rifkind Wharton & Garrison; Lindsay Parks – Paul Weiss Rifkind Wharton & Garrison; Rick Rule – Paul Weiss Rifkind Wharton & Garrison; Robert Schumer – Paul Weiss Rifkind Wharton & Garrison; David Sicular – Paul Weiss Rifkind Wharton & Garrison; Patricia Vaz de Almeida – Paul Weiss Rifkind Wharton & Garrison; Michael Vogel – Paul Weiss Rifkind Wharton & Garrison; Lawrence Witdorchic – Paul Weiss Rifkind Wharton & Garrison; Matthew Behrens – Shearman & Sterling; Brian Bishop – Shearman & Sterling; John Cannon – Shearman & Sterling; Creighton Condon – Shearman & Sterling; Stephen Giove – Shearman & Sterling; Denise Grant – Shearman & Sterling; Adam Hurwitz – Shearman & Sterling; Lisa Jacobs – Shearman & Sterling; Grace Jamgochian – Shearman & Sterling; Daniel Litowitz – Shearman & Sterling; Lona Nallengara – Shearman & Sterling; Kotoe Oshima – Shearman & Sterling; Caroline Préel – Shearman & Sterling; Kelsey Scribner – Shearman & Sterling; Michael Shulman – Shearman & Sterling; Adam Sternberg – Shearman & Sterling; Nathan Tasso – Shearman & Sterling; James Webber – Shearman & Sterling; Daniel Yao – Shearman & Sterling;

Law Firms: Cleary Gottlieb Steen & Hamilton; Cravath Swaine & Moore; Hughes Hubbard & Reed; Kirkland & Ellis; Latham & Watkins; Paul Weiss Rifkind Wharton & Garrison; Shearman & Sterling;

Clients: CBS Corp. – Special Committee of the Board of Directors; CBS Corporation; Centerview Partners; Lazard Frères & Co; LionTree Advisors LLC; Morgan Stanley; National Amusements, Inc.; Viacom; Viacom – Special Committe of the Board of Directors;

Author: Ambrogio Visconti