have entered into a work agreement on the management team that would lead the merged entity in the event of a merger. This threatened to get in the way of a deal.
Joe Ianniello, acting CEO of CBS Corp., was offered a job under the terms of the agreement to oversee all CBS brand values of the combined company.
Bob Bakish, CEO of Viacom, would be the chief executive of the combined company, people said. The agreement also stipulates that Christina Spade, Chief Financial Officer of CBS, will become Chief Financial Officer of the Combined Company.
CBS has not yet made an official offer for Viacom, and negotiations are still ongoing, people said. The timing of the deal is still uncertain, but both companies made progress, they said.
The management structure working agreement throws one of the biggest hurdles to a deal between the two sister companies. This is the third time in the last four years that CBS and Viacom are seeking a merger, with attempts being hampered by differences between companies. Issues still outstanding include the exchange ratio for the two companies and the composition of the Board of Directors.
Last year, CBS and Viacom had a dispute over Mr. Bakish's role with the merged entity and maintained a potential deal.
It is unclear whether Wade Davis, Chief Financial Officer of Viacom, will remain in the Combined Company as the Labor Agreement does not foresee a Chief Operating Officer.
Mr. Davis is involved in establishing Viacom's promotional sales strategy. His portfolio includes finance, corporate strategy, technology operations and the recently acquired direct-to-consumer video streaming service Pluto TV.
The administrative structure in question would be a departure from the way in which Viacom and CBS were organized in the past when the Deputy was Chief Operating Officer. Viacom's former Chief Operating Officer, Thomas Dooley, served in this position from 201
Former CBS CEO Leslie Moonves led the company with a deputy, Mr. Ianniello, who was then Chief Operating Officer. Mr. Moonves was forced to resign in September after several women accused him of sexual harassment and assault, and Mr. Ianniello was appointed Acting CEO. Mr Moonves has rejected allegations of non-consensual sexual relations.
The proposed structure does not exclude the possibility that Mr. Bakish will appoint a management oversight strategy after the announcement of the merger. Mr. Ianniello is eligible for a $ 70 million payout if he is not named CBS's permanent CEO under his contract.
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