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Viacom Inc.  (VIAB) - Get Viacom Inc. Class B Report shares surged Monday after the media group said it reached a deal to renew its distribution contract with DirecTV parent A&T Inc. (T) - Get AT&T Inc. Report .

Viacom had warned that DirecTV customers could lose access to channels such as Nickelodeon, BET, MTV, Comedy Central and Paramount after accusing AT&T of "busing its new market position by favoring its own content".  A March 22 deadline to renew the previous contract, which had paid Viacom around $1 billion in annual carriage fees, passed without progress, but the two sides came to an agreement Monday in a deal that looks to have boosted shares in both groups.

"We are pleased to announce a renewed Viacom-AT&T contract that includes continued carriage of Viacom services across multiple AT&T platforms and products," the companies said in a statement reported by multiple media outlets Monday.

Viacom shares were marked 5.25% higher Monday following news of the deal and changing hands at $26.67 each. AT&T shares edged 0.3% lower to around $31.00 each.

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Last month, posted stronger-than-expected first quarter earnings and said it would produce more shows with Netflix (NFLX) - Get Netflix, Inc. Report as it seeks to leverage its content in the face of intensifying streaming competition for viewers.

Viacom said advertising revenues fell 6% to $1.23 billion, with the international component of that total falling 13% to $323 million, but noted that affiliate revenues, Viacom said, rose 3% to $1.169 billion.

Film and entertainment revenues rose 14% to $621 million, Viacom said, "driven by worldwide theatrical gains, continued momentum at Paramount Television and international theme park revenues."

Viacom also told analysts on its conference call that its Nickelodeon division will produce two films --"Rise of the Teenage Mutant Ninja Turtles" and "The Loud House" -- for Netflix in a move it hopes will keep viewers engage across both platforms.