Reuters agrees to Thomson buyout
UK news company Reuters has agreed to be bought out by Canadian financial data provider Thomson in a deal worth about £8.7bn ($17bn).
The tie-up will create the world's biggest financial news and data firm, allowing the new company to leapfrog its main rival, US-based Bloomberg.
Other news firms are also eying mergers as they look to cut costs, squeeze rivals and increase their client base.
Reuters and Thomson reckon their deal will save them $500m (£250m) a year.
Thomson has been expanding its non-data business, and Reuters will complement its news operations in the US and AFX in Europe, analysts said.
They added a merged Thomson and Reuters would be better able to compete against Bloomberg.
The three companies are rivals in the "terminal" market, providing news and financial data on stocks, currencies and bonds to banks, traders and brokerages.
Industry figures released in April, estimated that Bloomberg had a 33% share of the terminal market, with Reuters controlling 23% and Thomson 11%.
Following the merger, the new company will be called Thomson-Reuters and will be listed on stock exchanges in London and Toronto.
Reuters boss Tom Glocer will head the newly enlarged firm.
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Published: 2007/05/15 06:27:21 GMT
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