Sumner Redstone, who turned his household’s movie-theater company into a worldwide media empire covering television, movies, radio and books, and who notoriously declared that “material is king,” has died.
Mr. Redstone’s death was revealed on Wednesday by his family’s holding business, National Amusements Inc. He was 97.
Rising from modest beginnings, Mr. Redstone achieved fame in the show business late in life, assembling a sprawling set of possessions through a mix of smart investing, innovative litigation and all-around ruthlessness. He was amongst a now-shrinking group of moguls like John Malone and Rupert Murdoch who have actually shaped the media landscape through gutsy mergers.
The media organisations he controlled, now part of.
provided a selection of shows into American living rooms and onto the cinema, from CBS prime-time reveals like “The Big Bang Theory” and profane cable programs on MTV and Comedy Central to movie hits from the Paramount Pictures studio such as “Titanic” and “Leading Gun.”
The mercurial Mr. Redstone was famously hot tempered in both his business and family transactions. Understood to his own grandchildren as “Grumpy,” for many years he sparred with and dismissed a number of top executives, feuded with almost all of his closest member of the family and was so tough on wait staff that he was barred from some dining establishments.
Having made it through a number of brushes with death– when by fire and later by cancer– he enjoyed to boast that he would never pass away. On the uncommon occasion that he would admit to being mortal, he ensured investors in his $27 billion media empire that his precise estate preparation would ensure that he would control his possessions from beyond the tomb.
However as his health began to fail in his later years, a series of battles unfolded over who would manage his empire. A question at the center of those battles was whether he had the psychological capacity to continue as the controlling investor.
When the dust settled by the fall of 2018, his once-estranged daughter, Shari Redstone, was calling the shots at both CBS and Viacom, as the de facto leader of National Amusements, the family holding business that owned 80%of the ballot shares in each service. The 2 former chief executives with whom she had sparred, Viacom’s Philippe Dauman and CBS’s Leslie Moonves, had actually been displaced. On her watch, CBS and Viacom consented to merge in 2019.
Sumner Redstone, accompanied by child Shari Redstone, at an awards ceremony in 2012.
Image:.
Katy Winn/Invision/Associated Press.
Mr. Redstone’s controlling interest in the media empire will now be managed by a trust on behalf of his grandchildren and their descendants. Ms. Redstone is on the trust, in addition to her child Tyler Korff, and numerous other Redstone family partners.
Mr. Redstone matured in Boston’s West End, a lower-income immigrant enclave. His household’s apartment had no toilet; they used a pull-chain commode down the hall. His daddy had actually dropped out of high school to drive trucks for his own daddy’s bakery-supply business, a resource that relative say he put to more profitable use throughout Prohibition.
Fights Over Sumner Redstone’s Empire
- Viacom-CBS Offer Drama Was Worthy of the Fall Lineup (Aug. 13, 2019)
- Shari Redstone’s Path to Power (June 22, 2018)
- As Soon As Allies, Two Media Chiefs Go to War Over the Future of CBS (May 28, 2018)
- Redstone Household’s Next Generation Takes On Larger Functions, Impact in National Amusements (Nov. 15, 2016)
- The Relationship That Helped Sumner Redstone Build Viacom Now Adds to Its Problems (April 11, 2016)
- Battle Brews Atop Media Giant Viacom (Oct. 7, 2015)
- Redstone Split Bears On Future Of Viacom, CBS (July 20, 2007)
After repeal, he entered into alcohol wholesaling and, in partnership with a local bookie, opened one of the country’s first drive-in theaters. The partners likewise went into the nightclub business.
His father changed the family name from Rothstein to Redstone when Sumner remained in high school, a modification that puzzled him. “I believed my daddy was attempting to leave our being Jewish,” he wrote in his 2001 autobiography, “A Passion to Win.” Others close to the household said it was Sumner, a skilled student who imagined a future far eliminated from any wrongful association with the well-known gangster Arnold Rothstein, who wanted the name change.
As a trainee at Harvard University, Mr. Redstone took part in an unique intelligence group that worked to break Japanese military and diplomatic codes during World War II. He attended Harvard Law School and, upon graduation, went to work in the government. He was a special assistant to the chief law officer when the Justice Department was pursuing U.S. v. Paramount, an antitrust case that separated the standard Hollywood studio system.
Sumner Redstone and talk-show host Larry King in 2009.
Photo:.
fred prouser/Reuters.
In 1954, he signed up with the household’s drive-in theater business, later on relabelled National Amusements, and gradually took control, aggressively broadening around the East Coast and Midwest. Making use of his Justice Department experience, he successfully took legal action against the significant studios in 1958 to require them to give his theaters leading movies at the same time they were made available to bigger theater chains.
He originated the development of theaters with more than one screen and even trademarked the term “multiplex” for the concept, now commonplace.
In 1979, at age 55, Mr. Redstone’s dazzling career was almost cut short.
” The fire soared my legs. The pain was searing. I was being burned alive,” he composed. What he didn’t mention in his autobiography is that he was in the room with his long time mistress, Delsa Winer, who handled to escape out the window with minor injuries. The fire left him with burns over 45%of his body and a gnarled claw for a hand.
In 1987, after a series of well-timed investments in Hollywood studios, Mr. Redstone made his biggest company move yet: going after Viacom. The company had actually been drawn out of CBS in 1971 to comply with new guidelines (reversed in the 1990 s) versus vertical integration. Viacom owned cable television systems, TELEVISION and radio stations, in addition to cable channels MTV and Showtime. The management of Viacom was trying to take it private. Mr. Redstone countered with a greater bid and eventually protected the offer for $3.4 billion.
One of Mr. Redstone’s lifelong dreams was to own the Paramount film studio, and he ramped up his pursuit of the business in the early 1990 s. It ended up being among the specifying battles of his career. After years of courting Paramount CEO Martin Davis, Mr. Redstone lastly negotiated an $8.2 billion offer to buy the company in 1993.
What followed was a fierce and very public bidding war that Mr. Redstone said strained his relationship with Mr. Diller. “This was a betrayal of the greatest order,” Mr. Redstone wrote in his autobiography.
Both sides raced to line up sources of money. Mr. Diller’s backers consisted of.
Liberty Media Corp.
‘s John Malone and.
Comcast Corp.
‘s Brian Roberts. Mr. Redstone tapped.
To seal the offer, Mr. Redstone engineered a dangerous merger with Smash hit that provided him access to cash flows to support a higher bid.
At the time, critics on Wall Street believed Mr. Redstone overpaid for a studio that had actually suffered a string of motion picture flops, however he was positive.
Mr. Redstone included CBS to his holdings in 1999 through a $37 billion stock merger, the largest media deal up to that point in U.S. history. Mr. Redstone saw the business’s broadcast TV and radio operations as natural complements to Viacom’s cable portfolio.
In 2006, frustrated with Viacom’s stagnant stock price, Mr. Redstone divided CBS and Viacom as soon as again. He put Mr. Moonves in charge of CBS; MTV leader Tom Freston was installed as Viacom’s president, but he didn’t last a year on the task.
In a move that surprised Wall Street, Mr. Redstone pushed Mr. Freston out following a drop in Viacom’s stock cost and reports that Viacom was slow to pursue chances such as an acquisition of social network Myspace, which went instead to rival.
( Myspace later faltered and News Corp. sold it for a fraction of the $580 million purchase cost.)
” I have one goal: to do what is finest for Viacom,” Mr. Redstone told The Wall Street Journal at the time.
Mr. Redstone also had plenty of turbulence in his individual life. The couple moved to Los Angeles, from Mr. Redstone’s long time East Coast base, taking house in a Beverly Hills mansion next door to Sylvester Stallone.
In February 2006, his boy Brent filed fit against National Amusements, seeking the company’s dissolution to acquire control of his one-sixth stake. The fit alleged his father led a project to “freeze out” his kid from the company’s business operations. National Amusements stated the accusations were unfounded. The fit was settled a year later, with Brent being bought out.
Mr. Redstone when touted his younger child, Shari, as a rising star and most likely follower.
Drama over Mr. Redstone’s condition began to magnify in the fall of2015 When the magnate kicked former companion Manuela Herzer out of his Beverly Park, Calif., mansion, and removed her as his health-care agent, she took legal action against to challenge his psychological competency.
The match was ultimately dismissed, however not prior to the case ended up being a significant spectacle in the media world. In a videotaped deposition, Mr. Redstone had great problem interacting, was not able to answer standard questions about himself or define words, according to a records.
In February 2016, Mr. Redstone stepped down as chairman of his 2 companies, and the boards elevated the particular chief executives– Mr. Moonves at CBS and Mr. Dauman at Viacom– to replace him in those posts.
But Mr. Redstone remained controlling investor and started to make sweeping changes. In May, following the resolution of the Herzer claim, Mr. Redstone eliminated Mr. Dauman from the National Amusements board and his trust. He later on replaced five Viacom board members. The removed parties took legal action against, looking for to be renewed and declaring that their dismissals were orchestrated by Ms. Redstone.
Ms. Redstone, a 66- year-old legal representative who also runs an early-stage investment outfit called Advancit Capital, rejected those charges.
The suits were dropped in a settlement that consisted of Mr. Dauman’s exit and left Ms. Redstone more powerful than ever.
Her first agenda was to prompt CBS and Viacom to check out a merger in the fall of2016 Lots of experts had long thought that the decision to split them had actually been an error and that the pairing of Viacom’s cable television channels with an essential broadcast network like CBS was a much better method to wring more cash out of pay-TV suppliers. Now that cord-cutting was injuring Viacom’s cable television channels more than CBS’s broadcast network, CBS’s then-CEO, Mr. Moonves, was cool to the possibility, and National Amusements quickly aborted the wedding.
A year later, with the media market continuing to consolidate, Ms. Redstone once again pressed CBS and Viacom to mull a merger but once again encountered resistance. CBS unleashed a surprise attack, suing in May 2018 to not simply block the merger, but to eliminate her household’s voting control permanently. National Amusements resisted, and the matter looked headed for trial.
On the other hand, a storm was collecting over CBS.
The first of the stories wasn’t enough to remove him, but quickly after the second one was published, he resigned in the middle of a broader settlement between CBS and National Amusements that dealt with the pending litigation and even more increased Ms. Redstone’s power. In December 2018, following an examination into Mr. Moonves’s alleged misbehavior, the CBS board fired Mr. Moonves for cause, denying him of $120 million in possible severance.
CBS and Viacom consented to merge in 2019, undoing the split Mr. Redstone had actually carried out 13 years previously. National Amusements provided unanimous approval to the deal, with Mr. Redstone among the directors enacting favor.
Mr. Redstone, a health nut who avoided sugar and swore by anti-oxidants, informed the Journal in 2012 that he was dealing with a brand-new book– later shelved– called “How to Live Permanently,” in which he planned to share his secrets to health.
As he informed the Journal: “The main point is that to have an excellent life, you have to enjoy your work.”
Write to Keach Hagey at keach.hagey@wsj.com and Amol Sharma at amol.sharma@wsj.com
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