NEW YORK (Reuters) - Media mogul Sumner Redstone and his daughter Shari called off their failed effort to merge CBS Corp (CBS.N) and Viacom Inc (VIAB.O) on Monday, sending shares of Viacom - widely viewed as the weaker company - down almost 8 percent.

The collapse of the plan, which never got beyond initial talks, raises questions about the future of both Redstone-controlled companies just as scale becomes more important in a media industry set to be reshaped by AT&T;’s (T.N) deal to buy Time Warner Inc TWX.N.

The end of negotiations was not a complete surprise. Les Moonves, the longtime chief executive of CBS, said last week talks were still stuck in the early stages, more than two months after the Redstones asked the boards of both companies to explore a tie-up.

The two sides never entered talks on pricing and were far apart on Viacom’s value, according to two sources familiar with the situation.

Shares of Viacom were down 7.9 percent at $39.10 in afternoon trading.

CBS shares initially rose 1.8 percent, touching a nearly 2-1/2 year high, after CNBC cited a New York Post report that Verizon Communications Inc (VZ.N) was interested in buying the company. Verizon declined to comment.

In afternoon trading, CBS shares were down 0.4 percent at $62.12.

STILL NEEDS FIXING

National Amusements, the privately held movie company through which Shari Redstone and her 93-year-old father control 80 percent of the voting shares of CBS and Viacom, said in a letter they stopped pushing for a deal on the expectation of a turnaround at Viacom under new leadership.

Viacom named Bob Bakish, head of its international business, acting chief executive officer at the end of October, and made that position permanent on Monday afternoon as it announced the end of merger explorations.

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

Viacom, which owns Nickelodeon, Comedy Central and MTV, has been struggling to turn around declining ad revenue and ratings while CBS is home to top-rated shows such “The Big Bang Theory” and “Thursday Night Football.”

Mario Gabelli, whose firm is the second-largest owner of voting shares of Viacom and CBS, said he was not disappointed with the failure of merger plans and that he still believes that ultimately the two might merge.

“Viacom needs to be fixed,” he said.

One sticking point in negotiations was that CBS’s Moonves wanted autonomy over the merged company.

National Amusements was willing to compromise on this issue, but in the end decided to let Bakish retain control of Viacom, according to the sources, who wished to remain anonymous because they were not authorized to speak publicly.

Bakish already has started taking action after just a few weeks as acting CEO. Last month, the company announced it was buying Argentine broadcaster Television Federal SA from telecom carrier Telefonica SA for $345 million.

He is also looking to improve relations with affiliates and is working on a plan to turn around MTV, a top priority for him, he told Reuters in November. Last week, he replaced Viacom’s head of distribution, Denise Denson, a longtime executive who worked closely with former CEO Philippe Dauman.

A DECADE APART

In September, National Amusements called on Viacom and CBS to consider recombining, 10 years after Viacom was spun off from CBS. Shari Redstone had been in favor of recombining the two under Moonves, sources have previously told Reuters.

Industry speculation that the two might rejoin increased this year after the Redstones prevailed in a power struggle that resulted in Dauman’s departure.

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A Viacom spokesman confirmed it had received the letter from National Amusements, which was first reported by CNBC. A CBS spokesman declined to comment.

National Amusement’s letter also said: “CBS continues to perform exceptionally well under Les Moonves.”

Relations between Moonves and Shari Redstone continue to be good, the source said. This week, the two plan to go to Boston for the premiere of the film “Patriots Day,” produced by CBS Films.</s>Shares of Viacom tumbled 6.8 percent in early New York Stock Exchange trading to $36. CBS shares were down 3 percent at $60.69.

"Following the management changes that the Viacom Board put in place, we have been very impressed with the forward-looking thinking and strategic plan being pursued under Bob Bakish’s leadership," National Amusements said in a letter to both boards.

The letter also said "CBS continues to perform exceptionally well under Les Moonves," the company's longtime CEO.

One major sticking point in negotiations was that Moonves wanted autonomy over the merged company, as Reuters reported in October.

National Amusements was willing to compromise on this issue, but in the end decided it liked the direction Bakish was taking the company, according to a source familiar with the situation who wished to remain anonymous because they were not authorized to speak publicly.

National Amusements believes Viacom is undervalued and that Bakish can help turn it around, according to two other sources familiar with the situation.

However, it does not mean that a combination between the two companies is off the table forever, said one of the sources.

Shari Redstone and her father, 93-year-old Sumner Redstone, control 80 percent of CBS and Viacom voting shares through their National Amusements Inc movie theater company.

In September, National Amusements called on Viacom and CBS to consider recombining, 10 years after first separating.

CBS and Viacom did not immediately have a comment on the news, which was first reported by CNBC.</s>WASHINGTON (dpa-AFX) - National Amusements Inc., the owner of a majority of CBS Corp. (CBS-A, CBS) and ViacomInc.'s (VIAB, VIA) voting stock, said Monday that it has asked the Boards of CBS and Viacom to discontinue their exploration of a potential combination.



Sumner Redstone and his daughter Shari Redstone's National Amusement said that after reviewing a tie-up 'we have concluded that this is not the right time to merge the companies.'



VIA is currently trading at $39.65, down $2.80 or 6.60 percent. CBS-A is trading at $61.62, down $1.60 or 2.53 percent.



In late September, National Amusements said it believed a merger could 'allow the combined company to respond even more aggressively and effectively to the challenges of the changing entertainment and media landscape.'



In the statement Monday, National Amusements called for a focus on the companies' 'independent paths forward.'



The Redstone firm said it is encouraged that the companies can thrive separately, citing new Viacom Acting Chief Executive Bob Bakish's 'forward-looking thinking and strategic plan' and confidence that Les Moonves, chief of CBS, could continue to deliver strong results there.



Copyright RTT News/dpa-AFX</s>NEW YORK (AP) — Media mogul Sumner Redstone’s National Amusements is abandoning a proposal that CBS and Viacom reunite after a 10 year split.

National Amusements, which owns most of the voting shares of the two companies, urged the companies to combine in September.

Now, the company says that following management changes at Viacom and strength at CBS, which operates CBS, Showtime and other entities, under Les Moonves it makes more sense for the companies to continue as separate entities. Viacom, which owns cable channels MTV, Nickelodeon and VH1, named Robert Bakish as acting president in late October.

National Amusements is a movie theater operator run by Redstone, who orchestrated the split of CBS and Viacom in 2006, and his daughter Shari Redstone.</s>ATLANTA (AP) — Media mogul Sumner Redstone’s National Amusements is abandoning a proposal that CBS and Viacom reunite after a 10 year split.

The news comes as Viacom named acting CEO Bob Bakish as its permanent head.

National Amusements, which owns most of the voting shares of the two companies, had urged the companies to combine in September, saying that a tie-up would help them compete better as technology and the entertainment industry rapidly evolve.

Now, the company, run by Redstone and his daughter Shari, says that following management changes at Viacom and strength at CBS, which operates CBS, Showtime and other entities, it makes more sense for the companies to continue as separate entities.

Viacom, which owns the Paramount Pictures movie studio and pay TV channels such as Comedy Central, MTV, BET and others, has been struggling to improve its profit as Paramount has struggled to produce hits and cable viewership declines.

The company named Robert Bakish as acting president in late October and appointed him permanent president and CEO on Monday.

The appointment caps off a management saga that culminated earlier this year, when longtime Viacom CEO Phillipe Dauman was pushed out following a legal battle with media mogul Sumner Redstone’s daughter, Shari Redstone, over control of the company. The fight ended with Shari Redstone as a Viacom director and president of National Amusements, which has a controlling stake in CBS and Viacom. At the time Tom Dooley was named interim CEO, but he announced unexpectedly he was leaving in October and Bakish was then named acting CEO.

Meanwhile, as more people cut the cable cord, choosing instead to stream TV shows or movies online at places like Netflix, Hulu, iTunes and Amazon.com, CBS has found success under Les Moonves streaming its popular shows like “NCIS” and “The Big Bang Theory,” as well as its stand-alone, streaming Showtime channel.

There would have been cost savings if the companies combined, but strategically, the positives weren’t as clear, said Instinet analyst Anthony DiClemente.

“This allows CBS to continue to operate in a very nimble and autonomous fashion,” DiClemente said. “For Viacom, I think in terms of long term strategy, the verdict is still out.”

Viacom said in a statement that it received the letter sent by National Amusements and will provide more updates later. CBS referred comment to National Amusements.

Viacom Inc. Class B shares fell $3.01, or 7.8 percent, to $35.61 in afternoon trading Monday. CBS Corp. Class B shares slipped 4 cents to $62.52.</s>Viacom stock dropped Monday morning after Shari Redstone called off a months-long exploration of a CBS-Viacom merger.

CBS stock was flat in pre-market trading. Viacom stock fell about 5 percent. The market moves came after CNBC reported that National Amusements, the controlling shareholder of both companies, has called off the merger talks.

Two sources with direct knowledge of the matter confirmed to CNNMoney that National Amusements sent a letter to the boards of CBS and Viacom asking the two boards to stop exploring a combination.

It will be released publicly Monday morning, one of the sources said.

Shari Redstone, the daughter of National Amusements chairman Sumner Redstone, squeezed longtime Viacom CEO Philippe Dauman out of the company over the summer.

Then the Redstones sent a letter to both Viacom and CBS in September asking them to consider a merger.

Since then, Shari Redstone has gained more confidence in the leadership of Viacom, one of the sources said. Bob Bakish was named the interim CEO of the company at the end of October.</s>Viacom and CBS stock dropped Monday morning after Shari Redstone called off a months-long exploration of a merger between the two companies.

The market moves came after CNBC reported that National Amusements, the controlling shareholder of both media giants, had put an end to the merger talks.

National Amusements subsequently released the letter it sent to the CBS and Viacom boards.

"We have concluded that this is not the right time to merge the companies," the letter said. "Following the management changes that the Viacom board put in place, we have been very impressed with the forward-looking thinking and strategic plan being pursued under Bob Bakish's leadership. We know Viacom has tremendous assets that are currently undervalued, and we are confident that with this new strong management team, the value of these assets can be unleashed."

"At the same time," the letter said, "CBS continues to perform exceptionally well under Les Moonves, and we have every reason to believe that momentum will continue on a stand-alone basis."

So the merger talks -- which were not exactly embraced by Moonves in the first place -- are now over.

The move comes at the end of a roller coaster year for Viacom, which has been underperforming other media companies at a time of massive industry-wide change.

Shari Redstone, the daughter of National Amusements chairman Sumner Redstone, squeezed longtime Viacom CEO Philippe Dauman out of the company over the summer.

Then the Redstones sent a letter to both Viacom and CBS in September asking them to consider a merger.

Since then, Shari Redstone has gained more confidence in the leadership of Viacom, two sources told CNNMoney. Bakish was named the interim CEO at the end of October.</s>Redstone's daughter Shari, who controls CBS's and Viacom's controlling shareholder National Amusements together with her father, told the New York Times Dealbook conference last month that scale was crucial for both companies, because it would give them greater pricing power in content distribution.

National Amusements, however, does not currently want to sell either company, according to people familiar with the matter who requested anonymity discussing confidential deliberations. The chief executives of CBS and Viacom are also currently not keen on making big acquisitions, because they are focused on executing their operational strategy, these people said.

Nevertheless, the two companies may be forced to consider acquisitions if they come under more competitive pressure, the sources said. They may also turn to partnerships with media companies as an alternative to outright acquisitions, the sources added.

"Should Viacom remain independent, we think it will need a strategic partner to help co-finance a larger and more expensive film slate," Brean Murray analyst Alan Gould said in a research note on Monday.

Pressure on media companies to consolidate has increased in the last two months, as some industry giants have sought to merge with major distributors of their content, in a bid to expand their reach and profitability.

In October, U.S. telecommunications giant AT&T Inc agreed to acquire media conglomerate Time Warner Inc for $85.4 billion, while last week Rupert Murdoch's Twenty-First Century Fox Inc reached a preliminary agreement to acquire the 61 percent of Sky Plc it does not already own, valuing the British broadcaster at $23 billion.

Viacom has already been looking at some modest acquisitions. Last month it acquired Argentine broadcaster Telefe for $345 million in cash, and in 2014 it paid $760 million for British broadcaster Channel 5.

Were Bob Bakish, who was named on Monday as the permanent replacement of previous Viacom CEO Philippe Dauman, to explore more acquisitions, he could again look across the Atlantic for opportunities beyond the fiercely competitive U.S. media market, the sources said.

German broadcaster ProSiebenSat 1 and its main rival, RTL Group, would be logical targets, the sources said, as would ITV Plc in Britain and Entertainment One in Canada. However, Viacom's $12 billion debt pile makes it unlikely it would spend top dollar on acquisitions.

There may be smaller deals for Viacom to pursue, however, that could boost its Paramount movie studio. MGM, which owns a film library and has been exploring its options for some time following its emergence from bankruptcy six years ago, could help boost Paramount's margins if it was acquired, some media bankers suggested.

None of these companies offered a comment on the possibility of being acquired by Viacom.

Jefferies LLC analyst John Janedis said in a research note that he thinks CBS should focus on buying "TV-centric content related assets, rather than cable networks and film."

However, CBS CEO Leslie Moonves' interest may be in buying a movie studio. Sources familiar with the matter said that CBS has approached Sony Pictures in recent weeks, although its owner, Sony Corp, has shown no interest in selling. Sony declined to comment.

Lions Gate Entertainment Corp, which has a movie and television studio, just closed its acquisition of Starz, and could also be an option for CBS, according to one media banker.

AMC Networks Inc, controlled by New York's Dolan Family, could also have operational synergies with CBS's cable channel, Showtime. Lions Gate did not respond to requests for comment and AMC declined comment.

To be sure, Moonves publicly has said CBS can do without any major acquisition.

"Will we ever be of a scale of a Disney or an Apple? I doubt it. We are able to play the game just fine as long as we keep doing what we do, which is produce great content for CBS, for Showtime, for whatever the platform is," Moonves told the UBS Global Media and Communications Conference last week.

An alternative to acquisitions may be partnerships, including between CBS and Viacom. Bakish has already been meeting with heads of Viacom affiliates talking about potential partnerships, one of the people said. Last month, he told Reuters finding ways to partner with affiliates was a priority for the company.</s>BEIJING (dpa-AFX) - The China stock market has alternated between positive and negative finishes through the last four trading days since the end of the three-day slide in which it had retreated almost 75 points or 2.3 percent. The Shanghai Composite Index now rests just above the 3,150-point plateau, and the market is in lien for more selling pressure on Tuesday.



The global forecast for the Asian markets is soft ahead of the FOMC's monetary policy decision on Wednesday - although a spike in crude oil prices should limit the downside. The European and U.S. markets were down and the Asian bourses figure to follow suit.



The SCI finished sharply lower on Monday following losses from the property stocks and resource plays.



For the day, the index plummeted 79.91 points or 2.47 percent to finish at 3,152.97. The Shenzhen Composite Index tumbled 100.68 points or 4.86 percent to end at 1,969.33.



Among the actives, Agricultural Bank of China shed 0.31 percent, while Bank of China jumped 1.39 percent, Industrial and Commercial Bank of China collected 0.87 percent, China Life skidded 1.05 percent, Ping An of China added 0.11 percent, Vanke plummeted 6.25 percent, Gemdale shed 1.78 percent, PetroChina lost 1.05 percent, China Shenhua fell 0.52 percent and Zijin Mining tumbled 3.12 percent.



The lead from Wall Street is murky as stocks were lackluster on Monday, although the Dow still hit a new record closing high.



The Dow rose 39.58 points or 0.2 percent to 19,796.43, while the NASDAQ fell 31.96 points or 0.6 percent to 5,412.54 and the S&P eased 2.57 points or 0.1 percent to 2,256.96.



The lack of direction precedes the Fed's monetary policy announcement on Wednesday. The Fed is widely expected to increase interest rates by 25 basis points, reflecting the first rate hike in a year.



The accompanying statement will be in focus, as traders gauge the outlook for further monetary policy normalization by the central bank.



Crude oil prices surged after Russia and Saudi Arabia formalized plans to cut oil production. Jan. WTI oil was up $1.33 or 2.6 percent to settle at $52.83/bbl.



Closer to home, China will release November numbers for industrial production, retail sales and fixed asset investment.



Industrial production is expected to hold steady at 6.1 percent on year, while retail sales are expected to advance an annual 10.2 percent - up from 10.0 percent in October. Fixed asset investment is expected to hold steady at an annual 8.3 percent.



Copyright RTT News/dpa-AFX</s>China's explosive demand for SUVs helped boost auto sales 17.2 percent in November over a year ago, an industry group said Monday, as automakers prepared for the end of a key tax break and a potential slump in demand.

Drivers in the world's biggest auto market by number of vehicles sold bought 2.6 million cars, minivans and SUVs, according to the China Association of Automobile Manufacturers. Total vehicle sales, including trucks and buses, rose 16.5 percent to 2.9 million.

The government helped shore up this year's demand by cutting the sales tax but that is due to end Dec. 31. Industry analysts expect sales growth to cool to mid-single digits unless that break is extended.

Sales of SUVs jumped 41.5 percent in November over a year earlier to just over 1 million vehicles.

For the first 11 months of the year, passenger vehicle sales rose 15.6 percent over the same period last year to 21.7 million.

The popularity of lower-priced models, a segment in which Chinese brands dominate, has helped domestic automakers claw back market share from bigger global rivals.

Sales by Chinese brands rose 21.7 percent in November over a year ago to 1.1 million vehicles, according to CAAM.

Sales of domestic brand SUVs soared 53.1 percent to 605,000. Chinese competitors expanded their share of the SUV market by 4.5 percentage points to 59.4 percent.

— General Motors Co. said sales of GM brand vehicles by the company and its Chinese partners rose 7 percent to 371,740. The company said its Cadillac, Buick and Baojun brands set monthly records. Year-to-date sales rose 8.5 percent to 3.4 million.

— Ford Motor Co. said its sales rose 17 percent to 124,113. Sales for the first 11 months of the year rose 10.7 percent to 1.1 million.

— Nissan Motor Co. sales rose 10.7 percent to 135,800. Year-to-date sales rose 9.3 percent to 1.2 million.

— Toyota Motor Co. sales rose 10.6 percent to 111,100. Sales for the first 11 months were up 11 percent at 1.1 million.

— BMW AG gave no November figure but said year-to-date sales of its BMW and MINI brands in China rose 11.2 percent to 472,705.
National Amusements announces CBS Corporation and Viacom media companies will not be merging. CBS shares rose 1.8 percent closing in on a nearly 2-1/2 year high while Viacom fell 6.9 percent.