ft.com/alphaville

Reuters terminals across the world will be churning out details of fresh ownership at the 150-year-old news and data service on Tuesday as the boards of Reuters and Thomson agree to combine their businesses.

So, what are the numbers?

• 352.5p in cash and 0.16 Thomson-Reuters shares for each Reuters share. Based on the closing Thomson share price of C$46.36 on Monday, each Reuters share is worth approximately 691p, valuing Reuters at around £8.7bn.
• Dual listed company structure will allow the combined business to have listings in Canada, the UK and the US.
• The combined business will adopt the Reuter Trust Principles. Woodbridge, the Thomson family holding company which controls approximately 70 per cent of Thomson before the deal, has agreed that it will use its voting control to support the Reuter Trust Principles.
• Woodbridge will own approximately 53 per cent of the combined business, other Thomson shareholders approximately 23 per cent and Reuters shareholders approximately 24 per cent.
• Reuters CEO, Tom Glocer, will become CEO of the combined business.
• Bear Stearns and Perella Weinberg are acting as financial advisers to Thomson; UBS, Morgan Stanley and Blackstone are acting as financial advisers to Reuters, while Citi and JPMorgan Cazenove are joint corporate brokers to Reuters as well as providing financial advice to them.

The age-old argument that Reuters could not be taken over because of its governing principles appears to have been circumvented. However, unions speaking in an article in the FT on Tuesday expressed their concern at the turn of events. The five unions, representing journalists, technical staff and other employees, drew attention to the Reuters constitution, which states that “no person may be interested in 15 per cent or more of Reuters issued shares.” “How then can the Thomson family hold a 53 per cent stake?” 

Pehr Gyllenhammar, chairman of the Reuters Founders Share Company that oversees the principles, told the FT two years ago the Founders Share Company was “not there to prevent a commercial undertaking but to protect the principles under which Reuters operates”. Indeed, speaking today on the announcement of the deal, he said: “The Trustees are pleased to give their support to the proposed business combination of Thomson and Reuters. We believe that the formation of Thomson-Reuters marks a watershed in the global information business, and will underpin the strength, integrity and sustainability of Reuters as a global leader in news and financial information for many years to come.”

‘Nuff said?