Paramount Communications Inc., the object of the fiercest takeover battle in years, Tuesday formally abandoned its allegiance to a merger with Viacom Inc. and threw open bidding for the company, saying all prospective buyers must submit offers by Dec. 20.
Paramount's board of directors also made the unexpected decision to allow company executives who are on the board to remain active in determining which is the better offer.Legal experts had expected the board at its Monday night meeting to establish an independent committee excluding the four directors who are also executives.
The Delaware Supreme Court last week criticized the board, led by Paramount chairman Martin Davis, for not fairly considering the offer from hostile bidder QVC Network Inc. It upheld a lower court ruling that Paramount couldn't block QVC's bid.
"The board considered at the meeting the formation of an independent committee, and concluded it was inappropriate," said Jerry Sherman, a company spokesman. "The entire board will continue to be involved in the process."
He refused to elaborate. Davis, who is trying to fend off QVC chairman and former Paramount Pictures head Barry Diller, reportedly opposed the idea of an independent committee.
Sherman also said the board decided not to hire a new investment bank or law firm to help evaluate the bids, as some legal experts had expected.