Report: Deals Await The New Viacom-CBS

The ink is barely dry on the merger deal between CBS Corp. and Viacom Inc., VIA and already Wall Street is anticipating which moves the combined company will make to bulk up further in an entertainment industry dominated by a few giants, reports The Wall Street Journal.

Executives at the companies have contemplated the idea of mergers with cable programmers including Discovery Inc. and premium network Starz or its owner, Lions Gate Entertainment Corp. , people familiar with the situation say. Sony Corp. ’s movie and TV unit, Hollywood studio MGM and AMC Networks Inc. are among other possible targets, industry executives and Wall Street analysts say.

The planned merger of CBS and Viacom brings together Viacom’s several major cable channels including MTV and Nickelodeon—and its movie studio Paramount Pictures—with CBS’s flagship broadcast network and premium cable channel Showtime, among other assets.

The combined company would still be much smaller than competitors that have separated themselves from the media pack through major deals. AT&T Inc., which acquired DirecTV and Time Warner Inc. in recent years, has a $254 billion market capitalization, while Walt Disney Co. , which last year took over the bulk of 21st Century Fox, is valued at $246 billion. CBS and Viacom have a combined value of $30 billion.

The larger media players believe their scale—both in terms of financial heft and in the vast reservoirs of content they control—will help them compete with streaming-video juggernaut Netflix Inc. as more consumers cut the cable-TV cord.

A former top Viacom executive said Viacom and CBS are late to the merger party. “They still don’t have the scale required to compete with the bigger players,” the executive said.

CBS and Viacom also could become a buyout target, industry analysts said, and further acquisitions by the merged company could make it a more attractive one.

Meanwhile, the merger of CBS and Viacom has staffers bracing for layoffs — but the companies are keeping mum about when and where they’ll wield the ax, according to The NY Post.

“The bigwigs are concerned for their jobs,” said a CBS source, explaining that corporate-level execs, like those with human resources, communications and ad sales, are concerned their jobs could be eliminated if they overlap with similar posts at Viacom.

On a conference call Tuesday, execs said the merger would save money, but stopped short of saying whether jobs would be part of the equation. CBS Chairman and Chief Executive Joe Ianniello mentioned “cost synergies” that would include subscriber growth of the companies’ streaming platforms, Showtime Anytime, CBS All Access and Pluto TV.