Philippe Dauman has already been removed from both the National Amusements board of directors and the Sumner M. Redstone Trust, but he’s still gainfully employed as chairman and CEO of Viacom — for now.
As Viacom CEO, the French-born Dauman serves at the will of the company’s 11-person board of directors, on which he still sits along with fellow just-ousted Redstone family trustee George Abrams.
That board has historically voted in Dauman’s favor — including naming him chairman in February via a 10-1 vote, with Sumner’s daughter Shari Redstone as the lone dissenter.
However, the board of National Amusements Inc., the Redstone-controlled holding company with an 80 percent stake of both CBS and Viacom, has the authority to add or subtract members from Viacom’s board, a person with knowledge of the situation told TheWrap.
The National Amusements board also controls Dauman’s director-level role at Viacom — and it’s unlikely you can be chairman of the board of directors if you’re not actually a director. And guess who has control of the National Amusements board? Sumner Redstone, who proved last week that he’s not afraid of exercising ultimate power.
The National Amusements board is made up of just four members right now: Sumner, daughter Shari Redstone and two newbies who were both just named to the tiny group on Tuesday morning: Kimberlee Ostheimer, an attorney and Redstone’s eldest granddaughter, and Jill Krutik, a former equity analyst Salomon Smith Barney and media executive.
Oh, and even in the unlikely scenario that one of them goes rogue, the voting shares there are controlled by Sumner, anyway — but he’s not planning on that being a problem.
“I have picked those who are loyal to me and removed those who are not,” the 92-year-old Sumner Redstone said this morning of the additions and subtractions.
He also brought Krutick and National Amusements EVP General Counsel Tad Jankowski aboard his seven-person family trust, replacing Abrams and Dauman: “This is my trust and my decision.”
So why hasn’t Dauman actually been fired yet? Seems like both a no-brainer and an inevitability, right? It’s a bit more complicated than just tallying votes.
Unlike National Amusements, Viacom and the Leslie Moonves-led CBS are publicly traded companies. While Sumner ostensibly can pull any strings he wants (or Shari Redstone can, if you believe the Viacom allegations that she is acting as her ailing father’s puppet-master), he has to answer to or at least acknowledge the company’s many shareholders.
Therefore, Sumner has to concern himself with Viacom’s stock price, which has slipped pretty dramatically over the last two years. Last Monday he requested that Dauman & Co. submit a plan for the struggling company, as well as offer specific suggestions on what to do with Paramount Pictures, which Dauman has proposed selling a minority stake in.
A person familiar with the process told TheWrap that nothing has been officially submitted yet, while Viacom said last week’s lengthy board meetings should have covered the requests for a strategy. Beyond that, the Comedy Central- and MTV-owner did not comment on this story.
Of course, the request kind of feels like it could be a simple formality for public relations purposes. After all, the once-strong relationship between Dauman and Sumner Redstone feels irreparably damaged — and there was never good vibes between Philippe and Shari.
And if there was ever a chance for a happy ending, that was probably crushed last week, even before Dauman and Abrams were ousted, when Viacom eliminated Sumner’s salary — a move that the chairman emeritus’ face reportedly took as a slap in the face.
Allegations about Shari’s “manipulation” of her father didn’t curry favor either, and the Dauman/Abrams-filed lawsuit Monday, attempting to declare Sumner incompetent, could be the final nail in Philippe’s Viacom coffin — unless a court overturns everything.