Reuters ready to make sacrifices to win merger approval - Sunday Telegraph
09 July 2007 | 6890 views | 0
Reuters is prepared to sacrifice its fixed income trading platform and Multex databases dealing with Estimates and Fundamentals in order to win regulatory approval for its $8.8 billion merger with Thomson, according to reports in the Sunday Telegraph.
The UK broadsheet says company representatives have already flown to Brussels to meet regulators, and the US Department of Justice has begun interviewing interested parties as part of a so-called Second Request process, which will determine whether the deal harms competitiveness or consumer welfare.
The prime candidates for disposal are Reuters' electronic bond trading platform and two databases that collect financial statements and press releases from 50,000 firms, as well as forecast data from analysts at 600 brokers.
According to the report, Reuters' Trading for Fixed Income - launched in February 2005 with support from ABN Amro, BNP Paribas, Goldman Sachs - is likely to be closed or sold in favour of Thomson's more successful TradeWeb platform.
Other Reuters products under scrutiny are Reuters Estimates, which collects forecast data from over 600 brokers, and Reuters Fundamentals, which assembles financial statements, press releases and public filings from 50,000 companies. Once again, Thomson has stronger products in these areas, including I/B/E/S, which collects estimates and historic data on companies.
Other speculative reports have focussed on the overlap between Thomson One and Reuters Trader in the provision of international market data.
Divisions earmarked for disposal could be put up for sale or simply closed, with staff reallocated to other parts of the company. Decisions on disposals are expected after the summer.