February 10, 2016 / 4:08 PM / 3 years ago

Viacom investor SpringOwl urges independent directors to quit

(Reuters) - Viacom Inc investor SpringOwl Asset Management urged the media company’s six independent directors to step down immediately, days after the board appointed Chief Executive Philippe Dauman to the additional post of executive chairman.

A woman exits the Viacom Inc. headquarters in New York April 30, 2013. REUTERS/Lucas Jackson

Viacom’s shares were down 3.7 percent in afternoon trading on Wednesday. They fell 21.5 percent on Tuesday, after the company reported revenue below Wall Street estimates for the fifth straight quarter.

SpringOwl, which has been agitating for change at Viacom, said the 11-member board was representing Dauman’s wishes, not those of shareholders.

SpringOwl questioned how “independent” the six independent directors really are.

Three have no media or digital experience, the investor said, while two can’t be considered independent as they have been on the board for decades.

Dauman, who railed against “naysayers” in Viacom’s post-earnings conference call on Tuesday, replaced ailing 92-year-old Sumner Redstone as executive chairman last week.

Only Redstone’s daughter Shari Redstone, non-executive vice chair of the board, voted against Dauman’s appointment, which was also greeted by skepticism by some investors.

SpringOwl, which had previously described the board as “too large, too cozy, and too overpaid”, urged Shari Redstone to chair a board committee to appoint new independent directors.

Sumner Redstone, who controls about 80 percent of the voting shares in Viacom, voted in favor of Dauman’s appointment, according to a source close to the company.

Reporting by Anya George Tharakan in Bengaluru; Editing by Sriraj Kalluvila and Saumyadeb Chakrabarty

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