Updated from 7:56 a.m. EDT

Viacom

(VIA) - Get Report

said CEO Tom Freston stepped down.

The New York-based media giant said Philippe Dauman replaces Freston. The company also named Thomas Dooley chief administrative officer.

Dauman and Dooley were Viacom vice chairmen from 1996 to 2000 and have since run private equity firm DND Capital.

Freston's departure comes just weeks after Viacom's controlling shareholder, Sumner Redstone, shocked Wall Street by publicly firing movie star Tom Cruise. Cruise said he quit to join hedge fund backers, but observers said that in any case the split undermined management at Viacom and its Paramount studio.

Redstone is no stranger to criticism of his hands-on management style. His relationship with another highly thought-of executive, former Viacom chief Mel Karmazin, ended with Karmazin walking out the door.

Meanwhile, Viacom shares have fallen this year, disappointing investors who expected the stock to rally once the company was freed of its slow-growth properties. Those operations were spun off into

CBS

(CBS) - Get Report

, which despite low expectations has risen.

In recent trading, Viacom class B shares were down $2.01, or 5.4% , to $34.97 in heavy volume. CBS shares were off 22 cents, or 0.7%, to $28.64.