Verizon Expressed Interest In Acquiring CBS Before Viacom Talks Heated Up

Verizon had expressed interest in acquiring CBS before merger talks heated up with its corporate sibling Viacom, sources say.

CBS disclosed the interest of another would-be acquirer in court documents today. In the filing, the network claims Shari Redstone, who controls CBS through the family-owned National Amusements, had discouraged the potential bidder from making an offer.

Multiple sources say Verizon had been involved in high-level discussions with CBS about a year ago. It’s unclear how far these talks had progressed, with some characterizing the conversations as early stage.

Redstone indicated that she would see greater value in a Verizon bid for both CBS and Viacom — a position that some saw as chilling interest in a potential deal.

Neither CBS nor National Amusements would comment, and Verizon did not respond to multiple requests seeking comment.

The talks, however preliminary, provide a backdrop for the CBS-Viacom merger discussions.

National Amusements may view a combined media property, whose assets include a top broadcast network, a film studio and multiple cable outlets, as positioned to fetch a higher price from a potential acquirer.

Media analyst Barton Crockett spotted CBS’s disclosure of an outside party’s interest in its lawsuit seeking a temporary restraining offer to prevent Redstone from taking steps to replace directors or interfere with a board vote on a proposal that would reduce the family’s voting control over the network.

“We do believe that in a consolidating media industry the unique assets at both CBS and Viacom could drive meaningful premiums to their current trading values, especially if, as we expect, Time Warner/AT&T are successful in defeating the DOJ’s antitrust lawsuit to stop the merger,” Crockett wrote. “In that case, we could see more interest among pipes/platform companies in acquiring meaningful legacy brands.”