Viacom, AT&T negotiations weigh on possible CBS tie-up: sources

Viacom Inc’s bitter contract renewal talks with AT&T Inc’s DirecTV that could see the blackout of MTV, Nickelodeon and Comedy Central by midnight Friday are weighing on a possible tie-up of CBS and Viacom, sources familiar with the discussions said.

Although the boards of CBS and Viacom have not discussed or decided on pursuing a merger, these sources say they are studying AT&T’s impact on Viacom and how it affects the company’s motivation to pursue a CBS merger. Viacom needs to resolve the AT&T contract before considering any other strategic moves including mergers and acquisitions, sources said.

Both companies are controlled by the Redstone family’s National Amusements Inc, which pushed for a merger last year but backed off as CBS explores other options before deciding on another run at Viacom.