Man Without Qualities

Tuesday, June 01, 2004

The Fall Of The House Of Eisner XX: Mel Mouse?

Mel Karmazin, the "architect of the CBS rebound", is out at Viacom ... long before his contract was to expire, long after he supposedly patched up his problems with Sumner Redstone, and with no real explanation.

On the other hand, the Walt Disney Company has been under strong pressure to fix it's lack of succession planning for nearly-semi-deposed Michael Eisner. One argument that keeps coming up is that there just aren't that many people with the right experience to run a media conglomerate ... especially in turning around a troubled major television net work.

Of course, there's Mel Karmazin ... but he's already working for Viacom.

UPDATE: I think it is unlikely that the trained poodle circus that passes for the Disney board would seriously consider replacing Michael Eisner with Mel Karmazin.

However, if Mr. Karmazin were willing to work with Roy Disney and, say, Steve Jobs in putting together a new, proposed management team and a new proposed board of directors, he might be a major player in a proxy contest for the Disney board. Messrs. Karmazin, Jobs, Gold and Disney could propose themselves as new, replacement Disney board members - along with whatever other proposed board members they select. Let the Disney shareholders vote.

Proxy fights are complex and expensive. But if the shareholders who were willing to withhold approval of Mr. Eisner at the last shareholder meeting were to spread the costs among themselves, a proxy fight would be quite feasible. And, if it happened, I would wager on a Karmazin-Disney-Jobs team simply because none of them is a spent force where Mr. Eisner clearly is.

In the mean time, all is completely predictable at Disney ( via Reuters)

Chairman George Mitchell on Tuesday said he was confident in current management as Mel Karmazin, long seen as a potential Disney chief, left rival media company Viacom Inc.

Dissident Disney shareholders Roy Disney and Stanley Gold immediately called for the board to look at Karmazin as a replacement for embattled Disney chief executive Michael Eisner.

Karmazin's abrupt resignation as president and chief operating officer of Viacom reignited speculation that he could replace Eisner.

Karmazin left the company unrestricted by any noncompete clause that would have stopped him from joining a Viacom rival. ....

Mitchell backed Eisner in a statement when asked to comment on Karmazin's exit.

"The board has complete confidence in the current management. On the strength of our recent results we believe that confidence has been justified, and will be further validated as our performance continues to improve," he said.

Disney and Gold said that Mitchell and the Disney board should consider Karmazin as they put together a succession plan for Eisner.

"We would assume he has or will be contacting Mel Karmazin, among other obvious candidates," they said. "(Karmazin) should definitely be on the Disney board's short list," they added.

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