The owner of Paramount Pictures and MTV on Friday said Chairman Emeritus Sumner Redstone, 93, will step down from Viacom's board in February though he will retain his title. Redstone's debilitating health was the subject of a bitter and prolonged two-year legal battle that ended in September when Redstone's daughter Shari forced former CEO Philippe Dauman to leave the company and drop a series of lawsuits.
Shares of Viacom traded up 2%, or 78 cents, to $35.68 midmorning Friday.
The announcement from Viacom comes as the company is clearly trying to move forward after a most tumultuous year. On Monday, Shari Redstone, through her family's control of Viacom, withdrew a proposed merger with CBS (CBS) - Get Report . By doing so, Redstone removed a cloud of uncertainty that had blanketed both companies for more than a year.
And then there's the c-suite changes. On Monday Viacom named Bob Backish CEO to replace Dauman. Backish had been president and CEO of Viacom International Media Networks.
In order to separate ties from Dauman Viacom agreed in September to a hefty settlement with the former executive and paid him handsomely despite deterioration of the company's largest businesses.
In a filing, Viacom said Dauman will receive a $58.4 million severance as part of his departure. Dauman, a close Redstone friend for more than 25 years, hasn't yet received all of that severance, said a source close to the settlement.
Dauman also received another $34.6 million in salary, bonus and stock options. Broken down, Dauman's salary for Viacom's fiscal year ended in September was $3.6 million. He was also awarded stock and stocks options valued at $21.2 million along with a cash bonus of $9.7 million.
The total compensation package to Viacom's former CEO of $93 million came as Viacom's annual revenue fell for a fourth consecutive year, punctuated by a $445 million loss at Paramount Pictures. The Hollywood studio's decline in recent years had prompted Dauman to seek a sale of 49% of Paramount, a proposal that Viacom's board under Shari Redstone's direction, dropped in September.
Prior to the settlement, shares of Viacom had fallen 50% during the previous two years as the company's cable-TV business suffered sharp declines in ad-sales and ratings. The number of households reached by Viacom's top six networks, which includes MTV, Nickelodeon and Comedy Central, fell 2.2% in the fiscal year ended September after dropping 3.6% in both 2015 and 2014.
Dauman also chose to spend about $9.7 billion between October 2012 and March 2015 buying back the company's shares in an attempt to increase its stock. That expenditure, which critics said should have gone to investing in new businesses, came to an average price per share of $73.58. Viacom on Friday was rising 2.7% to $35.84.
CBS CEO Leslie Moonves never warmed to the merger proposal, arguing that it could be detrimental to his company's performance. And Bakish, officially given the title of Viacom CEO on Monday, clearly preferred the opportunity to try to engineer a turnaround of a company he knows well following 10 years running its international business.
Taken together, it's been a busy week for Viacom. While none of the corporate changes directly addressed the troubles at Paramount or MTV, they are likely to give Bakish the clarity and support he needs to try to fix a company that no longer employs Dauman.