has reached a working agreement for the management team to lead the combined company in the event of a merger, said people familiar with the matter, and resolved a critical question that threatened with standing in the way of a deal.
Joe Ianniello, acting CEO of CBS Corp., would be offered a job overseeing all of CBS's brand values in the combined company under the employment contract, the people said.
Bob Bakish, CEO of Viacom, would be CEO of the combined company, the people said. The employment agreement also asks Christina Spade, chief financial officer at CBS, to become CFO of the combined company, they said.
CBS has not yet made a formal offer on Viacom and the negotiations are still fluid, some of the people said. The timing of the deal is still uncertain, but both companies are making progress, they said.
The management structure work agreement throws one of the biggest roadblocks to an agreement between the two sister companies aside. This marks the third time in the last four years that CBS and Viacom have sought a merger, with the trials dusted by differences between the companies.
An agreement could be announced by the end of the month, according to people familiar with the matter. Continuing outstanding topics include the degree of exchange for the two companies and the composition of the board.
Last year, CBS and Viacom met with Mr. Bakish's role in the combined company, and held a potential deal.
It is unclear whether Viacom's chief financial officer Wade Davis will remain in the combined company, given that the employment agreement requires there to be no CEO.
Mr. Davis is involved in setting Viacom's ad sales strategy, and his portfolio includes Viacom's finance, business strategy, technology operations and the recently acquired direct-to-consumer video streaming service Pluto TV.
The management structure under consideration would be a departure from the way Viacom and CBS have been organized lately, when the second-in-command has been head of the operations manager role. Viacom's former CEO, Thomas Dooley, served in that position from 201[ads1]0 to 2016, when he was named interim CEO; he left later that year. Viacom currently has no CEO.
Former CEO of CBS, Leslie Moonves, ran the company with a second in command, Mr. Ianniello, who was then operations manager. Moonves in September was forced to resign after several women accused him of sexual harassment and abuse, and Ianniello became acting chief executive. Moonves has denied allegations of non-consensual sexual relations.
The proposed structure does not preclude the possibility that Mr. Bakish will appoint an executive oversight strategy after the merger is announced. Mr. Ianniello is eligible for a $ 70 million payout if he is not appointed permanent director of CBS, according to his contract.
– Emily Glazer contributed to this article.
Write to Benjamin Mullin at Benjamin.Mullin@wsj.com and Cara Lombardo at firstname.lastname@example.org
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