DealBook Briefing: CBS’s Revolt Against Shari Redstone Is at a Crossroads

Good Thursday morning. If you’re not watching the NBA Conference Finals, why not? Some links require subscriptions.

“I’ve never seen anything like what’s transpired here today,” Andre Bouchard of Delaware’s Court of Chancery said at a hearing yesterday that became the battleground between CBS and its controlling shareholder, Shari Redstone.

CBS had sued Ms. Redstone to prevent her from interfering with a board vote to limit her voting power. A half-hour before the hearing, she rewrote the broadcaster’s bylaws to regain control. It was a sudden boiling point in the cold war over CBS’s reluctance to merge with its corporate sibling, Viacom.

What could happen when Chancellor Bouchard rules, as soon as today:

• He blocks Ms. Redstone’s bylaw amendment; CBS’s board proceeds to neuter its controlling shareholder; a big new precedent is set.

• He lets Ms. Redstone’s bylaw change stay; CBS’s insurrection is defeated; and the fate of its board and its C.E.O., Les Moonves, becomes cloudy. (Ms. Redstone has said she doesn’t want to oust the board.)

• Something else we haven’t thought of. Stay tuned.

The bigger picture: Jim Stewart notes that the battle casts a spotlight on dual-class stock structures:

____________________________

Today’s DealBook Briefing was written by Andrew Ross Sorkin on the road and Michael J. de la Merced in London.

____________________________

Who was the source behind documents showing that AT&T and Novartis had paid President Trump’s personal lawyer? A law enforcement official worried that two “suspicious activity reports” regarding Mr. Cohen were missing from a Treasury database. Here’s what he told Ronan Farrow of The New Yorker:

More on Mr. Cohen: President Trump disclosed paying Mr. Cohen over $100,000, raising questions about whether he should have said so last year. The head of a Qatari investment fund said Mr. Cohen had demanded $1 million in exchange for access.

It seems to be getting more personal: Peter Navarro, a hard-line trade adviser, reportedly bickered with Steven Mnuchin over the China negotiations. (Mr. Navarro briefly appeared unlikely to participate in a meeting with Beijing’s top economic negotiator, Liu He.)

More officials have voiced concern about easing sanctions on ZTE, including the F.B.I.’s director, Christopher Wray. Meanwhile, the U.S.’s top trade negotiator, Bob Lighthizer, reportedly told Democrats that he is pessimistic about reaching a Nafta deal this week. And the U.S. is starting to discover how hard it is to wean companies off Chinese imports. (The reverse is true, too.)

Meanwhile, European leaders appear more united in their negotiations with the administration over Iran sanctions, with a top official, Donald Tusk, tweeting, “With friends like that, who needs enemies.” Their challenge: Companies like Total are already preparing to withdraw from Iranian deals.

A reminder: ZTE’s punishment was for violating Iran sanctions — one reason Bloomberg Opinion argues it’s too important to bargain away.

• The Senate voted to block the repeal of net neutrality, but the House is unlikely to follow. (NYT)

• Robert Mueller’s team said it wouldn’t try to indict President Trump, according to Rudy Giuliani. The secret origins of the F.B.I.’s Russia investigation. The Senate Judiciary Committee released documents on that 2016 Russia meeting in Trump Tower.

• Britain has a new compromise idea on the E.U. customs union. (Bloomberg)

• How Crown Prince Mohammed bin Salman and his brothers profited from state-linked business, including a deal with Airbus. (WSJ)

He’ll testify before the European Parliament, a reflection of global concerns over privacy — but don’t expect a replay of the congressional hearings. This will be behind closed doors, with transcripts published afterward.

Meanwhile, Ireland’s data protection commissioner, Helen Dixon, and her 140 employees are preparing to oversee tech giants. How much can they do? (A separate data question: Did some of Cambridge Analytica’s Facebook haul end up in Russia?)

Elsewhere in tech: Apple is reportedly considering a Northern Virginia outpost. Silicon Valley’s grow-at-all-costs ethos now shapes non-tech companies like MoviePass. What Brian Chen found by downloading his Google data. The killing of a young female passenger has prompted Didi Chuxing to overhaul its service. Tencent and Ant Financial showed the financial might of Chinese internet titans. The S.E.C. ran a fake I.C.O.

• WeWork has expanded its education arm by acquiring MissionU. (Axios)

• The investment vehicle run by the owner of the Houston Rockets has agreed to buy the food delivery start-up Waitr for $300 million. (Bloomberg)

• Takeda Pharmaceuticals’s C.E.O. said higher R.&D. costs and a squeeze from governments and insurers drove his deal for Shire. CVC Capital Partners has halted talks to buy the Italian drug maker Recordati.

• TPG has reportedly reinvested in the security software maker Tanium at a $5 billion valuation. (Reuters)

• Your next hedge fund’s name may well involve booze or Nantucket. (Bloomberg)

The venture capitalist isn’t up for re-election, but the proxy adviser Glass, Lewis said it was concerned by “the fairly extraordinary length” of his leave of absence as a director. He stepped back amid a sexual misconduct investigation at his former investment firm, DFJ. The complaint: That reduces oversight of Elon Musk.

Elsewhere in workplace misconduct: A lawyer ridiculed Steve Wynn’s claim that he can’t have ogled dancers because he’s legally blind. Walt Disney may reportedly allow back John Lasseter, the senior animation executive accused of misconduct. The L.A. Times suspended its Beijing bureau chief, Jonathan Kaiman, amid allegations of sexual misconduct.

The $50 billion GCM Grosvenor is expected to announce this morning that its infrastructure business will team up with North America’s Building Trades Unions to make sure that “responsible contractors,” including union members, will be part of the process for its investments.

Sean McGarvey, the union’s president, said, “GCM Grosvenor’s responsible contractor policy is as good as any we have seen for workers and communities, if not better.”

Lachlan Murdoch is in line to be C.E.O. of a vastly smaller “new Fox” if the Disney deal goes through. (NYT)

Joe Sullivan, the Uber cybersecurity executive ousted reportedly for helping cover up a data breach, will become CloudFlare’s chief security officer. (CNBC)

• Bain Capital Ventures hired Sarah Smith, an early employee at Facebook and the answer site Quora, as its first female partner. (Bain Capital Ventures)

Kenneth Muller, a private equity specialist, has left Morrison & Foerster for Kirkland & Ellis. (American Lawyer)

• A Canadian-American council recommended steps to improve access to capital for female entrepreneurs. (Investissement Québec)

• A British retailer was accused of levying a “fat tax” by charging more for larger clothing sizes. (NYT)

• Sinclair continues to circle Sean Hannity. (Politico)

• Stan Lee has sued Pow! Entertainment, which he helped found, for $1 billion, alleging fraud. (Hollywood Reporter)

• The Robin Hood Foundation won’t say what its latest gala raised. (Bloomberg)

• Are you apologizing incorrectly? (Bloomberg Opinion)

Know someone who would enjoy this newsletter? Tell them to sign up here.

You can find live updates throughout the day at nytimes.com/dealbook.

We’d love your feedback. Please email thoughts and suggestions to bizday@nytimes.com.

Loading...

Related posts

Comment(1,133)

Leave a comment

1,133 Comments