UNITE HERE Calls for Accountability to CBS Shareholders, Urges Investors to 'Change the Channel'

UNITE HERE Calls for Accountability to CBS Shareholders, Urges Investors to 'Change the Channel'

NEW YORK, May 22 /PRNewswire-USNewswire/ -- At today's annual meeting, UNITE HERE is asking CBS Corporation shareholders to demand an explanation from executives about recent transactions concerning CNet and their plans for the Outdoor division. Questions have been raised, and we feel that CBS owes its shareholders an answer.

   (Logo: http://www.newscom.com/cgi-bin/prnh/20070817/CLF013LOGO )    What: UNITE HERE Asks CBS to Hold Itself Accountable to Shareholders   Where: AXA Equitable Building, 787 7th Ave. (at 52nd St.), New York   When: Thursday, May 22, 10:00am (Interview availability anytime)   

CBS Corp.'s recent purchase of CNet for $1.8 billion cash has grabbed headlines -- but has some analysts scratching their heads. The Wall Street Journal asked, "Why is CBS overpaying for an asset with a questionable outlook?," and a Morningstar analysis said "the acquisition will destroy value for CBS shareholders." Given questions surrounding CNet, UNITE HERE is urging shareholders to ask CBS what other factors it may be overlooking.

Responding to a JP Morgan Analyst's questions about the deceleration of revenue growth for Outdoor, CFO Fred Reynolds attributed this loss of two major transit contracts in San Francisco and Toronto, which were both outbid by rival companies. It's worth noting that in 2007, the company lost major transit contracts in New York, Chicago, and Minneapolis as well. Given CBS's substantial cash outlay for CNet, shareholders should question the company's ability to successfully bid on Outdoor contracts. If it is impaired, what is the possibly of losing additional contracts?

During a recent quarterly conference call, Moonves repeatedly described the conversion of traditional billboards to digital as a major income generator, but a Senate bill allowing automatic conversion to digital along landscaped highways was recently defeated. As activists gear up for similar battles nationwide, will restrictions limit CBS expansion plans?

The New York State Department of Transportation, with the state division of the Federal Highway Administration, has developed proposed criteria for the issuance of outdoor ad permits. The criteria would change the rate of digital ad turnover from current times as low as 6 to 10 seconds to 62 -- a major reduction in the number of ads that can be sold. If rules like this are passed, how will it affect CBS's growth estimates?

Analysts from Cowen & Company recently rated CBS Corp.'s stock as "Underperform," saying that they view it as "the company most exposed to a weakening economy." In this light, we feel shareholders should question whether the company's assurances regarding its online and Outdoor divisions seem overconfident.

CBS cannot even control the problems under its own roof: ARAMARK cafeteria workers serve the food in CBS's New York headquarters, but they have been on strike for eight weeks, seeking a fair contract to better provide for their families. CBS has yet to step in and use its influence to help end the dispute.

"As CBS presents a rosy outlook for shareholders, it yet again tries to sweep its problems under the rug -- just as it has by refusing to help resolve the strike at its headquarters," said Bill Granfield, President of UNITE HERE Local 100, which represents the striking ARAMARK cafeteria workers at CBS Headquarters. "It's time for the company to openly address the very real issues it faces and be accountable to its shareholders and workers."

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Source: UNITE HERE

CONTACT: Heidi Bruggink of UNITE HERE, +1-347-327-2655

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Profile: International Entertainment