Karmazin Quits Viacom With Two Years Pay Plus Garnish

02 June 2004

The respective eyeballs of Viacom chairman/ceo Sumner M Redstone and president/coo Mel Karmazin finally disengaged Tuesday after nearly five years of interlocked glaring.

Karmazin walked the platinum plank with immediate effect, his anguish assuaged by two years salary at $1 million annually plus a goody-bag stuffed with a company performance-based annual bonus ($6.66 million last year) and deferred compensation ($2.99 million in 2003).

Which leaves the 81-year old Redstone firmly in the driving seat of the group in which he is controlling shareholder. Curiously, however, given the respect accorded to Karmazin in Wall Street, the latter's abrupt departure caused hardly a ripple in Viacom's stock price.

One large shareholder -- Mario Gabelli of Gabelli Funds -- probably spoke for many on the Street: "Mel is Mel and Sumner is Sumner. This will eliminate a bit of uncertainty and now they will be able to focus on the fundamentals."

Meantime, Redstone vowed to remove his hands from the Viacom steering wheel within three years, signalling his successor is likely to be his daughter Shari.

For the present, however, day-to-day operating responsibility has been handed to Viacom's two most senior television executives Tom Freston and Les Moonves, appointed joint-chief operating officers.

Data sourced from: Financial Times and AdAge.com; additional content by WARC staff