CBS’s special committee, for its part, has retained Lazard as its financial adviser and Morton Pierce of White & Case as its legal counsel, the people say.
According to WSJ, given the struggles of Viacom’s cable networks and movie studio, finding a valuation that both sides can live with will be one of the big challenges in pulling off a deal, and there will be plenty of work for the investment banking and law firm crowd.
A decade after splitting apart, Viacom and CBS were asked to consider merging last week by National Amusements, the Redstone family’s holding company, which owns roughly 80% of the voting shares of both companies.
A reunion of the companies, which have a combined market capitalization of around $40 billion, would likely be the year’s biggest media deal and a potential fee bonanza for advisers lucky enough to land a role.
Bankers who win business on a Viacom-CBS merger could also get close to the industry’s newest mogul, Shari Redstone, who has risen to power in the media empire built up by her father, the 93-year-old Sumner Redstone. They would also likely be in strong position if the resulting entity went on the prowl for another big deal.
Viacom has been trying to deal with a heavy debt load, even as low cable TV ratings and a lack of hits from its Paramount Pictures studio put pressure on its financial results.
The hiring of financial advisors comes just a week after CBS and Viacom set up special committees to review a potential deal.
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