Merger of Data Broadcasting and Financial Times
Asset Management to Increase Annual Cash Flow
Five-fold to More Than $70 Million
Business Wire - November 30, 1999 11:16
JACKSON, Wyo.--(BUSINESS WIRE)--Nov. 30, 1999--
Earnings Before Income Taxes, Depreciation and Amortization Expected
to be Accretive, Almost Doubling To $0.77 Per Share
Data Broadcasting Corp. (Nasdaq:DBCC), America's leading provider of real-time financial
market data to traders and individual investors, today summarized additional information to
assist investors in understanding the significant potential of its previously announced agreement
to merge with Financial Times Asset Management (FTAM), part of Pearson plc, the
international media company.
Mark Imperiale, president and chief executive officer of Data Broadcasting, said: "We have
received numerous shareholder inquiries regarding the proposed merger of Data Broadcasting
and FTAM since the announcement and conference call on Nov. 15, 1999.
"In an effort to better communicate the merger's terms and strategic rationale, we decided to
issue this press release which summarizes the discussion held on the conference call. We will
also post the release to the dbc.com Web site for reference by our shareholders and the
investment community."
Imperiale continued: "The principle strategic reasons for the merger are scale, accretion of cash
flow per share, cross marketing, international expansion, content enhancement, branding and
cooperative opportunities among Data Broadcasting, FTAM, Financial Times group,
MarketWatch.com, ft.com, Pearson and CBS Broadcasting."
Imperiale said that the company believes the following benefits will be derived from the merger:
-- Scale: The combination of the businesses creates a powerhouse in
size and profitability, with the potential to become a top-tier
provider of financial information globally. Revenues will triple
and cash flow will increase five-fold, exclusive of any
significant revenue and cost synergies, and the combined company
will be debt free. This will give Data Broadcasting the scale to
develop new products and make additional, significant
acquisitions.
-- Accretion: For Data Broadcasting's fiscal year ended June 30,
1999, cash flow (EBITDA) was $14.1 million, or $0.40 per share on
35 million average outstanding shares. For the twelve months
ending December 31, 1999, pro forma cash flow is expected to be
more than $70 million, or $0.77 per share on 91.5 million average
outstanding shares.
-- Cross Marketing: FTAM's client base of some 3,000 institutions in
North America and 8,000 worldwide provide an outstanding
opportunity for sales of Data Broadcasting's BondEdge, InSite and
eSignal products.
-- International Expansion: With FTAM's existing presence in London,
Melbourne, Singapore, Hong Kong, Manila, Edinburgh, Brussels and
other European cities, Data Broadcasting will, for the first
time, have the opportunity to aggressively market its products on
a global basis.
-- Content: FTAM's databases on more than 3.5 million securities,
including international securities, historical pricing, corporate
action and dividend information, will give Data Broadcasting
significant competitive advantages in its products.
-- Branding: Association with the Financial Times brand will
significantly increase the value proposition and recognition of
Data Broadcasting's products. When Data Broadcasting formed its
MarketWatch joint venture with CBS, the company experienced
first-hand the power of brand association.
-- Cooperation: The merger will pave the way for greater cooperation
among Data Broadcasting, FTAM, Financial Times group,
CBS.MarketWatch.com, ft.com, Pearson and CBS.
In addition to describing the strategic rationale of the merger, the company clarified the merger
transaction itself. To accomplish the merger, Data Broadcasting will issue 56.5 million new
shares of its common stock to Pearson, increasing total outstanding shares to approximately
91.5 million.
As a result, Pearson will own 60 percent of Data Broadcasting, which will continue to trade on
Nasdaq under the ticker symbol DBCC. Each of the businesses has been growing revenues in
the 5 percent to 10 percent range, and combined are expected to accelerate that growth.
FTAM is a leading source of comprehensive disclosure data, factor information and
independent valuations for a comprehensive range of U.S. securities, and offers full descriptive
information of more than two million U.S. municipal bonds. It also collects and distributes
corporate action information on equities and bonds all over the world, specializing in "hard to
get" information from emerging markets.
FTAM is part of the Financial Times group, which also consists of the Financial Times
newspaper, ft.com, and interests in FTSE International, AFX News, the Economist magazine,
Les Echos and BDFM.
The Financial Times group is part of Pearson plc, the international media company, which also
owns Pearson Education, the world's leading education company; Pearson Television, the
world's leading international independent television production company; the Penguin group, the
world's most renowned English-language publisher; and Recoletos, one of Spain's leading
media companies.
Data Broadcasting Corporation is the leading provider of real-time market data to the individual
trader and investor. The company delivers real-time stock quotes, financial information and
news to the PCs, laptops and hand-held devices of millions of users via the Internet, dedicated
lines, wireless FM, cable and satellite.
With the BondEdge service from its Capital Management Sciences division, Data Broadcasting
also is the leading provider of fixed income portfolio analytics used for valuation and risk
management purposes. Data Broadcasting's Internet presence includes www.dbc.com,
www.eSignal.com, cbs.marketwatch.com, insite.dbc.com, www.bondedge.com,
sports.dbc.com and www.dbceuro.com.
Matters discussed in this release include forward-looking statements that involve risks and
uncertainties, and actual results may be materially different. Factors that could cause actual
results to differ include the response of competitors to the company's new services, acceptance
of the Internet as a valid real-time distribution platform by institutional customers, activity levels
in the securities markets and other risk factors listed in the Company's 10-K and 10-Q reports
to the Securities and Exchange Commission.
CONTACT: Data Broadcasting Corp., Jackson
Dwight H. Egan, 801/562-2252
or
Pondel/Wilkinson Group
Cecilia A. Wilkinson/Kristin Bruno, 310/207-9300
investor@pondel.com |
