CBS and Viacom to merge, reuniting network with Paramount Pictures

After years of on-again, off-again merger talks, broadcast giant CBS Corp. and its corporate sibling Viacom Inc. finally agreed Tuesday to reunite in a $12 billion deal that will bring together such well-known brands as CBS, MTV, Nickelodeon and Showtime.

CBS, which is the larger of the two companies and worth $18.5 billion, will absorb the smaller Viacom, which owns such assets as MTV, Nickelodeon, BET, Comedy Central and the Paramount Pictures movie studio in Hollywood. Nonetheless, the new company is expected to take the Viacom name in a nod to the legacy of Sumner Redstone, the ailing 96-year-old media titan who built an empire from a small chain of drive-in movie theaters in the Northeast.

Viacom CEO Bob Bakish will become chief executive and gain a seat on the board. Shari Redstone, the mogul’s daughter, will become the first chairwoman in Viacom’s history.

The proposed merger of the two New York companies is the latest in the wave of entertainment industry consolidations and was widely expected. It was the third time in three years that CBS and Viacom attempted to hook up.

The deal is a triumph for Shari Redstone, 65, who has overseen the Redstone family’s controlling stakes in the two companies since her father’s health declined. She pushed for the union, believing the pair would be stronger together during a turbulent time. The entertainment industry is facing intense pressure from technology behemoths Netflix, Amazon and Google, which introduced popular alternatives to traditional television. The changing economics has created a sense of urgency among major Hollywood studios to fortify themselves by bulking up.

Last year, telecommunications colossus AT&T bought HBO, CNN, TBS and the Warner Bros. studio in an $85 billion deal. In March, Walt Disney Co. completed a $71.3 billion acquisition of…