The ViacomCBS merger information got here as a aid to many Tuesday, with some buyers and observers tipping their hats to the brand new firm’s prospects and the shares of each firms ticking up 2% on the information.
However there have been additionally loads of naysayers, and never all the blowback was confined to social media.
Todd Juenger, an analyst with Bernstein Analysis and a longtime Viacom bear, downgraded CBS to “underperform,” reducing his 12-month value goal on the shares. “What a disgrace,” he lamented of the deal, utilizing the phrase because the title of his notice to shoppers. “We consider no matter synergies are produced (we assume $750 million) will pale compared to CBS shareholders investing Viacom’s structural issues,” he wrote.
Cash the brand new firm invests in direct-to-consumer choices, he went on, will likely be “wasted constructing a product that no person needs.”
Juenger, it needs to be famous, didn’t characterize the bulk view from Wall Road analysts, whose sentiment typically on the businesses has been impartial to optimistic currently.
The analyst had firm, although, in Mario Gabelli, the famous fund and CNBC common whose firm, Gamco, owns 9% of Viacom voting. In a discursive, oddly punctuated collection of tweets, Gabelli appeared to counsel authorized penalties are in retailer for the merger.
“Breach of fiduciary responsibility,” he wrote. “Legal professionals at work.” His criticism appeared to middle on “appraisal rights” for shares and the choice to transform voting shares with out preserving these rights. “Humbug!” The web outcome was Viacom shareholders having to just accept a valuation that he didn’t view as truthful.
In some press studies, Gabelli indicated he was contemplating authorized motion, although no paperwork has been filed.
On a much less materials stage, there was the identify ViacomCBS, which many on Twitter discovered unwieldy. Derided as a slipshod throwback to AOL TimeWarner or [email protected] (ouch) or the CW (a tortured transforming of the WB community as soon as CBS (the “C”) turned part-owner.
Analyst Wealthy Greenfield, previously with BTIG, issued a Twitter ballot. “How lengthy till it’s simply Viacom?” he requested. Within the lead as of Tuesday evening: “1 to three Years,” with 47% of the vote.