FRANK BIONDI, the former chief executive of Viacom, last night threw down the gauntlet to challenge Richard Parsons as he joined a team of disgruntled investors seeking to oust the Time Warner chief and mount a break-up of the media empire he runs.

Mr Biondi revealed last night that he would be prepared to stand as chief executive and chairman of Time Warner if a plan to break up the company proposed by Carl Icahn, the billionaire investor, was accepted by investors.

Mr Icahn and his supporters have built a stake of more than 3 per cent of the media company and are seeking to oust the current management, who they believe are not maximising Time Warner’s potential.

Time Warner shares have languished of late, rising 26 cents yesterday to close at $17.54. Mr Icahn believes that the shares would be worth more than $26 if his plan to break up the company and conduct a sizeable share buyback is adopted.

Mr Biondi’s membership of the dissident team lends it credibility as he is a respected veteran of the American media and entertainment industry. Apart from leading Viacom, Mr Biondi was once chairman and chief executive of Universal Studios and head of HBO, the cable channel owned by Time Warner.

Mr Icahn and his team have been working with investment bankers at Lazard to devise a suitable break-up plan for the vast media empire that includes Time magazine, the Warner Brothers movie studios, the AOL internet service and a large cable TV business. Mr Icahn’s plans will be revealed at a meeting with Wall Street analysts next Tuesday.

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