Rift between Redstones runs deep
EmptySumner Redstone has made it fairly clear that daughter Shari Redstone should not be considered his heir apparent.
The executive chairman of the boards of CBS Corp. and Viacom Inc. took his daughter to task in a letter to Forbes magazine reporter Robert Lenzner, who has been covering Redstone's exploits since the executive escaped death from a hotel fire in 1979.
Shari Redstone, vice chairman at CBS Corp. and Viacom, reportedly has been pushing her father to adopt certain corporate governance reforms, including more closely aligning executive pay with financial performance.
But in his letter to Lenzner, the 84-year-old Sumner Redstone seems to chastise his daughter for presuming that she should take his role at CBS Corp. and Viacom when the time comes.
"While my daughter talks of good governance, she apparently ignores the cardinal rule of good governance that the boards of the two public companies, Viacom and CBS, should select my successor," he writes.
Forbes posted the letter in its entirety on its Web site at the request of Sumner Redstone.
He also suggests that Shari Redstone's relationship with some board members has become a bit strained.
"I am determined that, in accordance with the rules of good governance, the boards of Viacom and CBS select my successor — and that no person be imposed on the boards," he wrote. "Moreover, the boards and I are also committed to the principle that my successor will deal with the members of the boards in an appropriate manner."
Sumner Redstone also reminded his daughter, as well as his son Brent Redstone, that their considerable wealth and association with the CBS Corp.-Viacom empire comes by way of his generosity.
"It must be remembered that I gave my children their stock; and it is I, with little or no contribution on their part, who built these great media companies with the help of the boards of both companies," he wrote.
News of a new rift between father and daughter surfaced last week, first in Fortune magazine and then in the Wall Street Journal. Stories in those publications said the feud could lead to Shari Redstone leaving the boards of CBS Corp. and Viacom.
While some speculated that Shari Redstone might be angling for a bigger stake in National Amusements — the theater chain that is the parent of CBS Corp. and Viacom — Redstone's letter instead suggests that her stake will be bought out.
Sumner Redstone owns 80% of National Amusements and Shari Redstone owns 20%. Brent Redstone had a stake in that company as well until he sued his father claiming that the elder Redstone was manipulating National Amusements for the benefit of Viacom.
The father and son settled the matter, with Sumner Redstone buying the younger Redstone's stake for a reported $240 million.
"There is no practical difference between my controlling 80% of the stock of National and 100% of the stock of National," Sumner Redstone wrote in his letter. "If Shari desires to be bought out, I will consider this as long as the price is acceptable."
Shari Redstone released a statement through a spokeswoman late Friday saying that she wasn't looking to be bought out, but that if it came to that she would consider selling her stake in a deal that valued National Amusements at a publicly quoted figure of $8 billion, which would make her stake worth $1.6 billion.
"Anyone who knows Shari Redstone knows that she is one Redstone family member who does not aspire to power or covet titles but rather is committed to the companies' best interests," the statement said. "It is unfortunate that Sumner has chosen to publicize what Shari had hoped would remain a private family matter."
The Associated Press contributed to this report.