Shares in the newly merged Thomson Reuters Group dropped in their debut on the London Stock Exchange (LSE) today amid concerns that the business will be badly impacted by the turmoil in the financial markets.
After opening at 1700 pence on the LSE the stock had dropped to 1630 pence by lunchtime making it the biggest faller in the FTSE 100 this morning. By later afternoon the stock was down over 13% to 1586 pence.
As well as falling in London the shares opened down in New York where they fell 80 cents to $36.63.
The fall has been caused, in part, by worries that massive cuts by banks will affect demand for the vendor's technology. This in turn has led to speculation about the potential for a large-scale redundancy programme within the integrated business.
Brokerage ABN Amro gave the stock a "sell" rating, citing the current backdrop of big job cuts by firms, which will have a knock-on affect on the market data industry - an industry that is thought to account for around 60% of Thomson Reuters' proforma revenue.
However the new group, formed through the £8.7 billion acquisition of Reuters by Thomson, is hoping non-financial businesses - such as Thomson's legal and healthcare units - will help cut its exposure to the financial markets and ride out the current downturn.
"Thomson Reuters will benefit from the value created by more diversified revenue streams, a larger capital base and synergies resulting from the acquisition," says group chief executive Tom Glocer in a statement. "Our leadership position and global footprint will give us opportunities to grow faster than either Thomson or Reuters could have on its own,"
Thomson Reuters marked its listing debut with the news that it may buy-back up to US$500 million of its shares over the course of the year. The vendor also revealed a new logo.View Thomson Reuters market data here