Sumner Redstone’s twilight years have become a soap opera, and here’s the latest plot twist: Last year he offered his daughter, Shari, $1 billion in cash and stock to give up her 20% stake in National Amusements, the theater chain that controls 80% of Viacom and CBS.
She rejected the November 2014 offer, according to The Wall Street Journal, which disclosed the development.
It came with strings attached: Shari would have had to give up any effort to become chairman of the media companies after Sumner passes and not challenge his gifts to now-former girlfriends Sydney Holland and Manuela Herzer. He also wanted National Amusements to lend enough cash to pay about $100 million in taxes on those gifts.
The story comes as Herzer asks the Los Angeles Superior Court to reinstate her as the 92-year-old executive’s health agent. She says Redstone was unable to make the decision in October to remove her and turn the decisions over to Viacom CEO Philippe Dauman.
Redstone’s National Amusements holdings will be governed after he passes by a seven-person trust that includes Shari Redstone and Dauman. Many believe that the two are vying to control of the trust, giving them indirect power to decide the fates of Viacom and CBS.
Dauman and CBS Corp President and CEO Leslie Moonves’ contracts give them the right to leave their companies with cause if each is not made chairman of his company.
The Journal says that documents tied to Sumner Redstone’s 2014 buyout offer note that Shari was to replace him as chairman of the two media companies following his demise. But a 2009 agreement only guarantees that she would become non-executive chairman.
The story adds that there’s a “written agreement with Les Moonves regarding the chairmanship of CBS.”
That could raise potentially troublesome corporate governance questions. The trust must vote the Redstone shares in the interest of his grandchildren and generations to follow. And the company boards can’t be seen as operating in a way that neglects the interests of independent shareholders.