Back in 2019, Viacom and CBS agreed to emerge back into a single company after breaking into two companies back in 2006. This merger upset many shareholders and led to a lawsuit over the merger.
The argument the shareholders have is that Paramount Chairman Shari Redstone breached her fiduciary duty by ramming through the merger. Shareholders said the merger was more about personal goals rather than what is best for the company.
Now Paramount has agreed to a settlement to end the lawsuit that will see it pay $122.5M pending a Judges approval, according to an SEC filing. This settlement is not done yet as a Judge still needs to approve the settlement before it can be finalized.
Paramount also announced it will sue some of its insurance carriers. Why was not said, but it seems that the companies are not willy to pay part or all of the settlement as Paramount seems to expect.
“The company is currently engaged in litigation regarding insurance coverage against certain of its insurance carriers in the Superior Court of the State of Delaware,” Paramount said in its filing. “The company intends to pursue its claims vigorously. Pending recovery of any such insurance proceeds, the company will advance funds for the settlement when they become due.”
The end of this lawsuit will allow Paramount to move forward now as one company. Long gone are Viacom and CBS as Paramount continues to bring its operations together under just one brand, as seen with Paramount+.