Business Case Studies, Succession Planning Case Study, Succession issues at National Amusements, Sumner Redstone's dilemma

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Succession Planning Case Study

Case Title:

Succession issues at National Amusements: Sumner Redstone's dilemma

Publication Year : 2006

Authors: Ruchi Mankad, Dr. A.V Vedpuriswar

Industry: Leisure and Tourism


Case Code: SUP0008A

Teaching Note: Not Available

Structured Assignment: Not Available

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In 2005 the media conglomerate Viacom was split into two companies; Viacom and CBS Corporation. Chairman & CEO, Sumner Redstone continued to serve as the Chairman of both the companies. The movie theatre company, National Amusements Inc. (NAI) controlled 71% of both Viacom and CBS. Sumner owned two-thirds voting shares of NAI and the rest was owned equally by Sumner’s daughter Shari Redstone and his son Brent Redstone. The total value of NAI was $8 billion. In February 2006, Brent filed a lawsuit and accused Sumner, Shari and other NAI directors of ‘self-dealing and favoritism’ and urged that NAI be dissolved. Sumner had kept silent and made no comments on the suit but the suit had highlighted and made open the succession and corporate governance issues at NAI and Viacom. How NAI and Sumner would respond to the allegations was eagerly awaited by all.

The case details the events that led to the suit by Brent for dissolution of the company. It attempts at identifying the succession and corporate governance issues in family owned businesses like NAI. The case in focus is another example of frequent rifts between family members in family owned businesses and the complexity of succession issues it could lead to.

Pedagogical Objectives:

  • To discuss the corporate governance and succession issues in family owned businesses
  • To debate on the future of the lawsuit.

Keywords : National Amusements; Viacom; CBS; Sumner Redstone; Brent Redstone; Shari Redstone; Succession Planning Case Study; lawsuit; dissolution of company; succession planning; corporate governance; media industry; family owned businesses; rift; ownership issues; voting share


  • National Amusements Inc.
  • Sumner Redstone
  • Shari Redstone
  • Brent Redstone

  • The Split of Viacom
  • The Suit
  • Conclusion

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