A Delaware judge on Monday ordered broadcaster CBS Corp to turn over records regarding its plan to reunite with Viacom Inc to a shareholder who wants to investigate if the deal unfairly benefits Shari Redstone, who controls both companies.
Reuters reports the deal is scheduled to close on Dec. 4, combining CBS television network, CBS News, Showtime cable networks with MTV Networks, Nickelodeon, Comedy Central and the Paramount movie studios.
The judge, Joseph Slights of Delaware’s Court of Chancery, ordered CBS to turn over materials the CBS board discussed when considering the merger with Viacom, which was split from CBS 13 years ago.
The company was also ordered to provide documents regarding the nomination and appointment of board members to the special committee that approved the merger earlier this year, as well as some communications between Redstone and the board.
Shareholders were not given the opportunity to vote on the deal, which follows two recent failed attempts to merge the companies that are both controlled by National Amusements Inc, the holding company of Sumner Redstone and his daughter Shari.
Larry Hamermesh, a professor at Delaware Law School in Wilmington, said the shareholder is likely to seek damages after the merger closes, rather than trying to block a deal that is closing soon.
Also on Monday, a Viacom shareholder, Louis Wilen, filed a proposed class action lawsuit against the board of Viacom in the same court. The complaint was filed under seal and no details beyond the parties’ names were disclosed.
Shares of the combined company, which would be renamed as ViacomCBS Inc, are expected to start trading on Nasdaq from Dec.5 under the new ticker symbols “VIACA” and “VIAC”, the companies said.
Earlier in August, CBS and Viacom agreed to merge, creating a company with more than $28 billion in revenue, as an increasingly competitive media landscape prompted their controlling shareholder to reunify the U.S. entertainment companies 13 years after breaking them up.
The two companies are controlled by National Amusements Inc, the holding company owned by billionaire Sumner Redstone and his family.
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