The trustees of London-based Reuters Group have given their consent to a $17.2 billion combination offer from electronic publisher Thomson Corp, based in Toronto.
The new business, which will be named Thomson-Reuters, will be one of the world’s largest financial news businesses, rivaling Bloomberg LP. The businesses also compete in the same space as Dow Jones & Co., which is currently the target of a $5 billion takeover bid from Rupert Murdoch’s News Corp. (WebCPA and its sister print publications were formerly owned by Thomson.)
Some regulatory obstacles must still be cleared for the deal to be completed, including getting approval from antitrust regulators in the European Union.
Also this week, Thomson announced that the assets of its education unit, Thomson Learning, will be sold for $7.75 billion in cash, to funds advised by two equity groups. The expectation is that the cash will go towards financing the Reuters deal.
Thomson’s operational headquarters are located in Stamford, Conn. The Thomson family will own a majority 53-percent stake in the combined company, while Thomson will control about 70 percent of the shares in the new company. Both companies said that the combined business would adopt the current Reuters constitution, which stresses the importance of operating with journalistic independence.
Reuters’ chief executive Tom Glocer, a former M&A lawyer, will lead the new company. Thomson’s chairman, David Thomson, will hold the same title at Thomson-Reuters.
Thomson Financial will be combined with Reuters’ financial and general news business and operate under the Reuters name.
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