Viacom President and CEO Tom Freston Resigns

Media and entertainment company Viacom Inc. (VIA) on Tuesday said Tom Freston has resigned as its president and chief executive, and named industry veteran Philippe P. Dauman to replace him.

Viacom owns MTV, VH1, Comedy Central and the Paramount movie studio, and is headed by Viacom founder and Chairman Sumner Redstone.

Freston's departure comes only days after Redstone disclosed that Paramount was abruptly ending its 14-year relationship with Tom Cruise, saying the movie star's off-screen behavior was hurting box office returns.

Freston, 60 and a founder of MTV, became president of Viacom in January when it split off its CBS television and radio into a separate company called CBS Corp.

Viacom also named Thomas E. Dooley to the newly created position of senior executive vice president and chief administrative officer.

Both Dauman, 52, and Dooley, 49, have previously held a number of executive positions at the company, and both currently serve on Viacom's board.

Since 2000, they have both run DND Capital Partners, LLC, a private equity firm specializing in media and telecommunication investments.

Dauman will report to Redstone, while Dooley will report to Dauman.

In a statement announcing the changes, Redstone said he had "great respect" for Freston and thanked him for his contributions to Viacom over 20 years. He said Freston had built MTV into "an unmatched force in the entertainment industry" and added, "we wish him well as he moves on to the next stage of his career."

Dauman and Dooley have worked with Redstone for more than 20 years. Dauman has been a director of Viacom since 1987, oversaw strategic transactions, legal and government affairs, human resources and administration in the 1990s and was general counsel of Viacom from 1993 to 1998.

Dooley held various corporate positions at Viacom from 1980 to 2000, was a board member from 1996 to 2000 and rejoined the board in 2006.

"I could not be more pleased to be teaming up again with Philippe and Tom, who are two of the most extraordinary executives I have ever known and with whom I shared the most productive and successful period in Viacom's history," Redstone said in the statement.

In Aug. 22, Redstone said Paramount would sever its relationship with Cruise/Wagner Productions, Cruise's company with producing partner Paula Wagner. Redstone told The Wall Street Journal that Cruise's "recent conduct has not been acceptable to Paramount."

In the past year or so, Cruise jumped on a couch on Oprah Winfrey's talk show while proclaiming his love for Katie Holmes, criticized the use of antidepressants and claimed that postpartum depression doesn't exist.

Redstone estimated that Cruise's off-screen behavior cost his latest movie, "Mission: Impossible III," $100 million to $150 million in ticket sales, even though it was "the best of the three movies" in the action series.

"It's nothing to do with his acting ability, he's a terrific actor," Redstone said. "But we don't think that someone who effectuates creative suicide and costs the company revenue should be on the lot."

Cruise/Wagner Productions has been based on the Paramount lot since 1992.