CBS and National Amusements appear to have ironed out the details for the upcoming court battle over the broadcaster’s move to dilute NAI’s control over its voting shares.
The companies will face off Oct. 3, 4, 5, 8 and 9 later this year, according to a filing with the Court of Chancery in the State of Delaware, obtained by Variety. Initial discovery in the case is expected to wrap up by August 22.
The scheduled showdown will determine if CBS can go ahead with a dividend to dilute NAI’s voting shares from 80% to 17%.
The conflict arose out of NAI’s latest attempt to get CBS and Viacom to recombine. After deciding a remerger was not in the best interest of its shareholders, CBS moved to cut out NAI as its majority shareholder, citing several offenses perpetrated by NAI’s Shari Redstone.
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“The Special Committee believes that the Company and its public stockholders face a serious threat of imminent, irreparable harm in Ms. Redstone’s potential response to the Special Committee’s unanimous decision yesterday, May 13, 2018, that the proposed Viacom transaction is not in the best interests of CBS stockholders (other than NAI),” CBS wrote in its lawsuit.
CBS went on to accuse Redstone of interfering with the CBS board nomination process, of acting to undermine CBS’ “highly lauded and successful management team in a series of escalating attacks,” and blocking another unnamed acquisition partner from pursuing a deal with CBS.
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For its part, NAI has vowed that it has no intention of forcing a merger between CBS and Viacom. It has called CBS’ proposed dividend “unlawful.”
“As NAI’s complaint makes clear there was no ‘threat’ or ‘interference,’ and indeed there was no action that could possibly warrant the CBS directors’ unprecedented, unjustified, and unlawful efforts to unilaterally dilute NAI’s voting rights. Unlike CBS’ complaint, NAI’s complaint is based on actual facts. Those facts demonstrate that CBS’ allegations are false, and that the CBS board and special committee took their actions not in response to any genuine threat, but instead because Les Moonves has tired of having a controlling shareholder. While Les Moonves is an extremely capable television executive, neither he, nor the board acting at his behest, is entitled to strip NAI of its voting control,” NAI said in a statement.
The court dates somewhat coincide with recent changes CBS made to its investor events schedule. According to a filing with the SEC, CBS’ annual shareholders meeting, which was originally scheduled to be held May 18, will now take place Aug. 10 at the the Langham Huntington in Pasadena, California. CBS also set the close of business on July 5 as the record date for determining the holders of shares of the company's Class A Common Stock.