Reuters reports takeover approach; shares surge
04 May 2007 | 5473 views | 0
UK financial news and information vendor Reuters has confirmed that is has received a preliminary takeover approach for the company from an unidentified suitor.
Reuters confirmed the talks after its stock soared in early trading on the back of market gossip.
"The board of Reuters confirms it has received a preliminary approach from a third party which may or may not lead to an offer being made for Reuters," says the Reuters' statement. "There is no certainty an offer will be made or necessary approvals, including those required under Reuters constitution, will be received."
Reuters shares had earlier touched a five year high of 644 pence on the back of market speculation of a 600 pence-per-share bid from its Canadian rival Thomson Corporation - which is setting up a rival international news service later this year.
Rupert Murdoch's News Corporation, which made a $5bn takeover bid for Dow Jones earlier this week that was turned down, was also thought to be a possible suitor.
However a bid for Reuters would have to comply with the group's unusual share ownership rules where any attempt to buy more than 30% of the company can be blocked by independent trustees of the Reuters Foundation Share Company. According to Reuters' Web site, the foundation's objective is to maintain the company's "independence, integrity and freedom from bias in the gathering and dissemination of news and information".