National Amusements Inc., the private holding company controlled by the Redstone family, is withdrawing its proposal to merge CBS Corp. and Viacom Inc.

National Amusements said Dec. 12 that the Redstones sent a letter to the boards of both companies backing newly appointed Viacom CEO Bob Bakish's plan to revive the company. "Over the past few months, after careful assessment and meetings with the leadership of both companies, we have concluded that this is not the right time to merge the companies," the letter said.

The Redstone family controls 80% of the voting shares in Viacom and CBS through National Amusements. In October, the special committee of Viacom's board hired financial advisers to explore a potential merger with CBS after National Amusements recommended such a deal.