Toronto
Thomson and Reuters 'a matter for the next generation' - David Thomson
Saturday 18 September 2010
“Canadian media family executive David Thomson rarely ventures outside his Toronto hometown, but he was in London for a board meeting of Thomson Reuters followed by drinks and dinner with the City’s movers and shakers,” the Financial Times reported on Saturday.
“At the British Museum event midweek, he expressed faith in the digital media future, ahead of a relaunch of the family’s Globe and Mail publication in Canada. But he shrugged off the question of whether the Thomson name would remain twinned with Reuters as a matter for the next generation.”
The FT gave no further details about Thomson’s remarks at the event. It said chief executive Tom Glocer welcomed HSBC chairman and UK trade minister designate Stephen Green, who was a fellow panellist at a conference held during the week by strategic advisory group Oxford Analytica on global risk and the global economy.
Thomson, 53, grandson of the family media empire’s founder the late Lord Thomson, became chairman of Thomson Corporation in 2002 and chairman of the merged entity after the acquisition of Reuters in 2008. He does not use his hereditary title of 3rd Baron Thomson of Fleet. Forbes magazine ranks him and his family the richest in Canada and 20th richest in the world with a fortune of C$19 billion.
Lord Thomson founded a media dynasty, ensuring that control passed to his son, Kenneth who died in 2006, and his son, David. In his 1975 autobiography, Lord Thomson wrote: “David, my grandson, will have to take his part in the running of the Organisation and David’s son, too. With the fortune that we will leave to them go also responsibilities. These Thomson boys that come after Ken are not going to be able, even if they want to, to shrug off these responsibilities.”
● SOURCE Financial Times
Bank of America initiates TRI coverage, sees $39
Wednesday 06 January 2010
Bank of America initiated analyst coverage on Thomson Reuters with a Buy rating and set a price target of $39.
In November, Barclays initiated coverage with an “equal weight” rating.
TRI.N traded three per cent higher at $33.35 in New York on Wednesday. In Toronto the share was 2.5 per cent higher at C$34.47.
● SOURCE Street Insider
In November, Barclays initiated coverage with an “equal weight” rating.
TRI.N traded three per cent higher at $33.35 in New York on Wednesday. In Toronto the share was 2.5 per cent higher at C$34.47.
● SOURCE Street Insider
Thomson family, Canada's richest, increases wealth despite recession
Thursday 19 November 2009
“In compiling our 11th annual Rich 100 list, we were surprised to discover that at the tail-end of the recession the majority of Canada's richest had not just stopped bleeding money - they were making it again. A lot of it,” the magazine said.
From April to September, the Toronto Stock Exchange composite index rose by nearly 45 per cent – a rise further bolstered by the strength of the Canadian dollar. That translated into a C$7.6 billion rise in the net worth of Canada’s 100 richest people. Almost half of that gain – just over C$3.5 billion – went to Canada’s richest family by far, the Thomsons headed by the 3rd Baron Thomson of Fleet, pictured.
“The family of the late Kenneth Thomson was worth roughly $21.99 billion as of late September, when we finalized our calculations for this year," Canadian Business said. "That’s an impressive 19% jump from last year, when the sagging fortunes of the media industry had hammered the value of the family’s central asset: more than 455 million shares in Thomson Reuters Corp. But that really fails to capture the awe-inspiring windfall that the rebound bestowed upon Canada’s richest clan. Consider this: that $3.5-billion gain from 2008 to 2009 translates into $10.9 million per day, $452,500 per hour, $7,540 per minute and $126 per second. But even at that, the Thomsons are still well below their record high of $25.35 billion, reached in 2007.”
Thomson Reuters shares have fallen by C$1.99 in the past couple of months, carving C$907 million off the family fortune, the magazine said.
“But the Thomsons won’t need to worry about selling assets to pay the bills any time soon. It’s been three years since Ken, the kindly family patriarch who was frequently seen walking his dog around Toronto’s posh Rosedale neighbourhood, passed away. His son, David, is now head of the family’s collection of businesses, and serves as chairman of Thomson Reuters.
“Like his father, David shuns the spotlight and rarely speaks publicly. That’s also true of the other siblings, Peter - who is also active in the family businesses and sits on the board of Thomson Reuters - and sister Taylor, who has worked as an actress and producer, but plays little role in the family business.”
● SOURCE Canadian Business
Thomson Reuters obtains final approval for shares de-listing
Tuesday 25 August 2009
Thomson Reuters announced on Tuesday it has obtained UK court approval to unify its dual listed company structure. Shareholders overwhelmingly approved the unification on 7 August and no additional approvals are required.
The last day of trading in Thomson Reuters PLC ordinary shares on the London Stock Exchange and American Depositary Shares (ADSs) on NASDAQ will be 9 September, and the unification will close on 10 September. Thomson Reuters Corporation common shares will continue to trade on the Toronto Stock Exchange and the New York Stock Exchange.
On 10 September former Thomson Reuters PLC shareholders who receive Depository Interests representing entitlements to common shares will be able to convert them into those shares by calling Computershare in Canada and the United States at +1 877 624 5999 or by sending an e-mail to ● globaltransactionteam@computershare.com. In the United Kingdom and elsewhere outside Canada and the United States call +44 870 702 0003 extension 1075, or send an e-mail to ● allukglobaltransactionteam@computershare.co.uk. Thomson Reuters will pay all applicable conversion fees between 10 September and 10 December 10. Additional information about the Depository Interests is available in the Investor Relations section of ● www.thomsonreuters.com.
Thomson Reuters expects settlement of newly-issued common shares and DIs to occur on or about 14 September.
Holders of Thomson Reuters shares as of 21 August are entitled to receive a dividend of 28 cents per share on 15 September. Due to the timing of the closing of the unification, Thomson Reuters PLC shareholders who previously enrolled in the company's dividend reinvestment plan will receive this dividend in cash. Enrollment information for the Thomson Reuters Corporation plan is available in the Investor Relations section of ● www.thomsonreuters.com.
● SOURCE Thomson Reuters
The last day of trading in Thomson Reuters PLC ordinary shares on the London Stock Exchange and American Depositary Shares (ADSs) on NASDAQ will be 9 September, and the unification will close on 10 September. Thomson Reuters Corporation common shares will continue to trade on the Toronto Stock Exchange and the New York Stock Exchange.
On 10 September former Thomson Reuters PLC shareholders who receive Depository Interests representing entitlements to common shares will be able to convert them into those shares by calling Computershare in Canada and the United States at +1 877 624 5999 or by sending an e-mail to ● globaltransactionteam@computershare.com. In the United Kingdom and elsewhere outside Canada and the United States call +44 870 702 0003 extension 1075, or send an e-mail to ● allukglobaltransactionteam@computershare.co.uk. Thomson Reuters will pay all applicable conversion fees between 10 September and 10 December 10. Additional information about the Depository Interests is available in the Investor Relations section of ● www.thomsonreuters.com.
Thomson Reuters expects settlement of newly-issued common shares and DIs to occur on or about 14 September.
Holders of Thomson Reuters shares as of 21 August are entitled to receive a dividend of 28 cents per share on 15 September. Due to the timing of the closing of the unification, Thomson Reuters PLC shareholders who previously enrolled in the company's dividend reinvestment plan will receive this dividend in cash. Enrollment information for the Thomson Reuters Corporation plan is available in the Investor Relations section of ● www.thomsonreuters.com.
● SOURCE Thomson Reuters
Shareholders vote to quit London Stock Exchange
Friday 07 August 2009
Twenty-five years after Reuters floated on the London Stock Exchange, Thomson Reuters shareholders voted on Friday to delist, distancing Reuters further from its British roots.
The vote at an extraordinary general meeting in London was 97.4 per cent in favour of quitting the LSE. At a simultaneous EGM in Toronto the figure was 99.6 per cent. Fewer than 100 shareholders attended the London meeting, with a similar number in Toronto.
The Canadian vote was decided by Thomson's family holding company, Woodbridge, which owns about two-thirds of the outstanding shares in Thomson Reuters Corp and had already committed to vote in favour of the move.
It will also delist from NASDAQ, remaining on the main New York and Toronto exchanges.
The delistings are expected to take place on 10 September, subject to UK court approval.
Shareholders in Thomson Reuters PLC are entitled to receive one Thomson Reuters Corp share for every PLC share they hold, while holders of American Depository Shares will receive six Thomson Reuters Corp shares per ADS.
Thomson Reuters, formed in 2008 when Canadian data publisher Thomson bought Reuters, has said it wants to simplify its capital structure and eliminate the persistent discount at which the London shares have traded to the Canadian shares.
The UK shares have traded at a discount to the Canadian shares since the April 2008 merger. The gap has narrowed to 2 per cent from 13.6 per cent before the company announced its plan in June to delist the London shares.
"I expect that a more straightforward capital structure will ensure that the focus of investors will remain firmly on the company itself and not on its capital structure," chief executive Tom Glocer told shareholders in London.
Not all shareholders agreed with the decision. "This country is a link to Europe. It looks like everything is going to shift to America and I'm a bit nervous about that," Allan Ferguson, who holds about 686 Thomson Reuters shares, told the London meeting. "I feel that we're just going to be another outpost."
Glocer has moved his base to New York from London, which remains the company's second-biggest base. Thomson Reuters made 58 per cent of its revenue in the Americas, 32 per cent in Europe, the Middle East and Africa and 10 per cent in Asia last year.
Paul Julius Reuter opened his news and stock-quote service in London in 1851. It became a global news service and in 1984 became a public company with shares listed in London and New York.
Thomson Reuters says UK shareholders own only about a quarter of its London-listed shares, down from about 58 per cent in 2007, and hold only 5 per cent of the company's total outstanding shares.
Some analysts say London investors were influenced by memories of Reuters' poor performance during the last downturn, and were not convinced of the more defensive qualities of Thomson's products aimed at legal, health and tax professionals.
On Thursday, Thomson Reuters reported a better than expected quarterly profit helped by cost cuts, and said it expected 2009 revenue to grow as the financial industry recovered and banks started hiring again.
Credit Suisse, Bernstein and RBC raised their target price on the shares on Friday, but Jefferies downgraded the stock, saying it expected some UK shareholders to take profits rather than convert into Canadian shares.
● SOURCE Reuters
The vote at an extraordinary general meeting in London was 97.4 per cent in favour of quitting the LSE. At a simultaneous EGM in Toronto the figure was 99.6 per cent. Fewer than 100 shareholders attended the London meeting, with a similar number in Toronto.
The Canadian vote was decided by Thomson's family holding company, Woodbridge, which owns about two-thirds of the outstanding shares in Thomson Reuters Corp and had already committed to vote in favour of the move.
It will also delist from NASDAQ, remaining on the main New York and Toronto exchanges.
The delistings are expected to take place on 10 September, subject to UK court approval.
Shareholders in Thomson Reuters PLC are entitled to receive one Thomson Reuters Corp share for every PLC share they hold, while holders of American Depository Shares will receive six Thomson Reuters Corp shares per ADS.
Thomson Reuters, formed in 2008 when Canadian data publisher Thomson bought Reuters, has said it wants to simplify its capital structure and eliminate the persistent discount at which the London shares have traded to the Canadian shares.
The UK shares have traded at a discount to the Canadian shares since the April 2008 merger. The gap has narrowed to 2 per cent from 13.6 per cent before the company announced its plan in June to delist the London shares.
"I expect that a more straightforward capital structure will ensure that the focus of investors will remain firmly on the company itself and not on its capital structure," chief executive Tom Glocer told shareholders in London.
Not all shareholders agreed with the decision. "This country is a link to Europe. It looks like everything is going to shift to America and I'm a bit nervous about that," Allan Ferguson, who holds about 686 Thomson Reuters shares, told the London meeting. "I feel that we're just going to be another outpost."
Glocer has moved his base to New York from London, which remains the company's second-biggest base. Thomson Reuters made 58 per cent of its revenue in the Americas, 32 per cent in Europe, the Middle East and Africa and 10 per cent in Asia last year.
Paul Julius Reuter opened his news and stock-quote service in London in 1851. It became a global news service and in 1984 became a public company with shares listed in London and New York.
Thomson Reuters says UK shareholders own only about a quarter of its London-listed shares, down from about 58 per cent in 2007, and hold only 5 per cent of the company's total outstanding shares.
Some analysts say London investors were influenced by memories of Reuters' poor performance during the last downturn, and were not convinced of the more defensive qualities of Thomson's products aimed at legal, health and tax professionals.
On Thursday, Thomson Reuters reported a better than expected quarterly profit helped by cost cuts, and said it expected 2009 revenue to grow as the financial industry recovered and banks started hiring again.
Credit Suisse, Bernstein and RBC raised their target price on the shares on Friday, but Jefferies downgraded the stock, saying it expected some UK shareholders to take profits rather than convert into Canadian shares.
● SOURCE Reuters
Cost cuts help Q2 results beat forecasts
Thursday 06 August 2009
Thomson Reuters reported a better-than-expected quarterly profit on Thursday, helped by cost cuts, and affirmed its 2009 outlook that revenue will grow despite tough conditions in the financial industry.
Q2 underlying operating profit rose 11 per cent to $793 million, or 58 cents per share, from $713 million, or 39 cents per share, in the same quarter a year ago. Analysts had expected earnings of 43 cents per share on that basis, according to Reuters Estimates.
The company attributed the profit growth to cost controls, currency benefits and savings from Thomson's purchase of Reuters last year. It expects $1 billion of annual savings by the end of 2009. The target is $1.4 billion by 2011.
Revenue from ongoing businesses, excluding the impact of foreign exchange rates, rose two per cent to $3.28 billion.
The company stuck to its forecast that revenue would grow this year and that underlying operating margin and free cash flow would be comparable to 2008, even as customers cut staff and budgets in the wake of the financial crisis.
"Quite a few banks are saying, 'Oh, we cut too deeply and we're finding business is so good, we need to hire people to handle the volume,'" CEO Tom Glocer said in a Reuters interview. "I couldn't imagine six months ago that people would be talking about guaranteed bonuses over multiple years to hire people," he said.
Nevertheless, the fallout from the financial crisis will likely squeeze the Markets division, Glocer said. "It's only logical to assume that in the second half of the year, the (division's) reported revenue growth will go below the zero line rather than above it."
Thomson Reuters shares on the London Stock Exchange traded 6.44 per cent higher at 2000 pence after the release of the results, smashing through the previous 52-week high.
Shareholders will vote at extraordinary general meetings in London and Toronto on Friday on a proposal to delist the company's shares in London. They will continue to trade in New York and Toronto.
● SOURCE Reuters | Transcript of analysts’ conference call
Q2 underlying operating profit rose 11 per cent to $793 million, or 58 cents per share, from $713 million, or 39 cents per share, in the same quarter a year ago. Analysts had expected earnings of 43 cents per share on that basis, according to Reuters Estimates.
The company attributed the profit growth to cost controls, currency benefits and savings from Thomson's purchase of Reuters last year. It expects $1 billion of annual savings by the end of 2009. The target is $1.4 billion by 2011.
Revenue from ongoing businesses, excluding the impact of foreign exchange rates, rose two per cent to $3.28 billion.
The company stuck to its forecast that revenue would grow this year and that underlying operating margin and free cash flow would be comparable to 2008, even as customers cut staff and budgets in the wake of the financial crisis.
"Quite a few banks are saying, 'Oh, we cut too deeply and we're finding business is so good, we need to hire people to handle the volume,'" CEO Tom Glocer said in a Reuters interview. "I couldn't imagine six months ago that people would be talking about guaranteed bonuses over multiple years to hire people," he said.
Nevertheless, the fallout from the financial crisis will likely squeeze the Markets division, Glocer said. "It's only logical to assume that in the second half of the year, the (division's) reported revenue growth will go below the zero line rather than above it."
Thomson Reuters shares on the London Stock Exchange traded 6.44 per cent higher at 2000 pence after the release of the results, smashing through the previous 52-week high.
Shareholders will vote at extraordinary general meetings in London and Toronto on Friday on a proposal to delist the company's shares in London. They will continue to trade in New York and Toronto.
● SOURCE Reuters | Transcript of analysts’ conference call
Reuters' many flags - FT
Wednesday 24 June 2009
Thomson Reuters’ decision to end its London Stock Exchange listing will deny British index funds and those institutions with an outdated mandate to invest only in UK-listed companies the opportunity to share in future growth of the business, the Financial Times said on Wednesday.
Something has gone a bit awry when UK investors keep their exposure to London-listed Kazakh miners that are part of the FTSE 100 index but lose their stake in a global media business with deep roots in Britain, it said in a report under the headline “Reuters' many flags”.
But Thomson Reuters’ experience does not necessary rule out a dual-listed structure the next time somebody wants to mount a cross-border takeover using shares, rather than cash, the FT said.
Companies as diverse as Thomson Reuters' competitor Reed Elsevier, cruise company Carnival, and miner Rio Tinto maintain a dual listing.
“But the structure is an impediment when raising funds - or defending against a hostile bid - it imposes an additional running cost ($10 million a year in Thomson Reuters' case), and it adds complexity when simplicity is in fashion.”
The FT quoted a 1915 leaflet celebrating the 50th anniversary of Reuter's Telegram Company: "Reuter's Agency has always been recognised as a British institution representing the English point of view. [Its managing director] is in all respects an Englishman. The Directors, the Editorial Staff, and the correspondents are British pure and simple, and so, with the exception of a score, are the 1,200 shareholders."
Reuters once had to defend itself against allegations of undue German influence during the First World War, the FT said. “Times have changed. No one will accuse Thomson Reuters of treasonable behaviour for ending its London listing. The media group has recognised the inevitable reality and UK-based shareholders have voted with their feet. Since last year's deal with Canada's Thomson, the proportion of Thomson Reuters PLC's shares held in London has dropped from 58 per cent to less than 25 per cent. The balance of shareholder power has inexorably shifted to New York and Toronto.
“If there is concern about the decision in London, it won't be on patriotic grounds. Reuters had been a global company for years before the Thomson deal (although according to a history of the group, Sir Peter Job, managing director, dismissed a 1980 suggestion to relocate its HQ to Geneva as "pallid internationalism").”
The FT noted that “Paul Julius Reuter, the agency's founder, had two names (he was born Israel Beer Josaphat), two nationalities (German and English) and two religions (Jewish and Christian), so you wouldn't bet against Thomson Reuters adding another listing in future (Shanghai, perhaps). But, barring takeover or break-up, London is, regrettably, unlikely to be one of them.”
● SOURCE Financial Times
Something has gone a bit awry when UK investors keep their exposure to London-listed Kazakh miners that are part of the FTSE 100 index but lose their stake in a global media business with deep roots in Britain, it said in a report under the headline “Reuters' many flags”.
But Thomson Reuters’ experience does not necessary rule out a dual-listed structure the next time somebody wants to mount a cross-border takeover using shares, rather than cash, the FT said.
Companies as diverse as Thomson Reuters' competitor Reed Elsevier, cruise company Carnival, and miner Rio Tinto maintain a dual listing.
“But the structure is an impediment when raising funds - or defending against a hostile bid - it imposes an additional running cost ($10 million a year in Thomson Reuters' case), and it adds complexity when simplicity is in fashion.”
The FT quoted a 1915 leaflet celebrating the 50th anniversary of Reuter's Telegram Company: "Reuter's Agency has always been recognised as a British institution representing the English point of view. [Its managing director] is in all respects an Englishman. The Directors, the Editorial Staff, and the correspondents are British pure and simple, and so, with the exception of a score, are the 1,200 shareholders."
Reuters once had to defend itself against allegations of undue German influence during the First World War, the FT said. “Times have changed. No one will accuse Thomson Reuters of treasonable behaviour for ending its London listing. The media group has recognised the inevitable reality and UK-based shareholders have voted with their feet. Since last year's deal with Canada's Thomson, the proportion of Thomson Reuters PLC's shares held in London has dropped from 58 per cent to less than 25 per cent. The balance of shareholder power has inexorably shifted to New York and Toronto.
“If there is concern about the decision in London, it won't be on patriotic grounds. Reuters had been a global company for years before the Thomson deal (although according to a history of the group, Sir Peter Job, managing director, dismissed a 1980 suggestion to relocate its HQ to Geneva as "pallid internationalism").”
The FT noted that “Paul Julius Reuter, the agency's founder, had two names (he was born Israel Beer Josaphat), two nationalities (German and English) and two religions (Jewish and Christian), so you wouldn't bet against Thomson Reuters adding another listing in future (Shanghai, perhaps). But, barring takeover or break-up, London is, regrettably, unlikely to be one of them.”
● SOURCE Financial Times
TR's London shares gain 7.3 per cent on delisting news
Tuesday 23 June 2009
Thomson Reuters' London shares had their biggest gain in more than six months after the company unveiled plans to quit the London Stock Exchange.
The shares rose as much as 7.3 per cent to 1750 pence, the biggest gain since 19 December, before falling back to 1720 pence. The London shares later gave up more of the gain, closing at 1690 pence, a rise of 59 pence or 3.62 per cent on the day.
Over the past year the London shares have traded at a discount of up to 20 per cent to the North American shares, although this has narrowed to about 10 per cent recently.
It was described as an arbitrageur’s dream, allowing investors to sell the more expensive North American shares and buy the cheaper British ones.
Thomson Reuters said on Monday it would remain listed on the Toronto Stock Exchange and New York Stock Exchange, while quitting the LSE and NASDAQ.
● SOURCE Bloomberg | MarketWatch
The shares rose as much as 7.3 per cent to 1750 pence, the biggest gain since 19 December, before falling back to 1720 pence. The London shares later gave up more of the gain, closing at 1690 pence, a rise of 59 pence or 3.62 per cent on the day.
Over the past year the London shares have traded at a discount of up to 20 per cent to the North American shares, although this has narrowed to about 10 per cent recently.
It was described as an arbitrageur’s dream, allowing investors to sell the more expensive North American shares and buy the cheaper British ones.
Thomson Reuters said on Monday it would remain listed on the Toronto Stock Exchange and New York Stock Exchange, while quitting the LSE and NASDAQ.
● SOURCE Bloomberg | MarketWatch
Delisting won't affect operations, customers, strategy or financial position - Tom Glocer
Tuesday 23 June 2009
“Unification would benefit shareholders by creating a single deep, global pool of liquidity and a simpler, more transparent capital structure,” he said in a message to the company’s 52,000 staff.
“Our shares are currently listed on four different stock exchanges [London, New York, NASDAQ and Toronto], which has fragmented the trading in our shares and deterred certain large global investors from buying our shares. Unification would also reduce costs and complexity across the company.
“You might fairly ask did we not anticipate when we announced the structure in 2007 that a DLC [dual listed company] would split the trading in our shares and carry a cost and complexity burden? We did, but we believed that these disadvantages would be outweighed by retaining and attracting an active following of investors in the UK. Unfortunately, things have not worked out that way. Over the past two years the percentage of shares held by UK active shareholders has declined from 45% of Thomson Reuters PLC to 12%, and North American investors now own 64% of PLC shares. Overall, UK shareholders now represent only 5% of our consolidated shareholder base. In these circumstances, it is now far better to unify our structure to offer a single, deep pool of liquidity to global investors.”
Glocer encouraged staff who hold Thomson Reuters shares to vote for the change at shareholder meetings scheduled for 7 August. He said shareholder meeting materials and proxy forms will be available in early July.
Following unification, all Thomson Reuters shareholders will have the same economic and voting interests in the company as they do under the current DLC structure, Glocer said.
“Our commitment to customers, employees and other stakeholders in London, the United Kingdom and Europe is unchanged by where we list our shares. London is a vital global capital for the markets we serve and home to more than 5,000 of our employees.
“The Founders Share Company has indicated it will support unification as this will in no way diminish our adherence to the Reuters Trust Principles.”
● SOURCE Thomson Reuters
Thomson Reuters to quit London Stock Exchange
Monday 22 June 2009
Thomson Reuters said it plans to withdraw its shares from the London Stock Exchange, “severing a key connection with Reuters' British roots”, as Reuters’ own story put it.
The company said it would also remove its shares from NASDAQ and remain listed only on the New York and Toronto exchanges.
Chief executive Tom Glocer played down concerns that Thomson Reuters could lose any UK-based shareholders through the action, noting that only five per cent of all shareholders are in the United Kingdom. He expressed hope that those shareholders would retain their holdings even after the delisting.
"Our shares are now fragmented, divided between North America and London in a way we didn't envision. That's hurting the company because there are investors who would come in but won't," Glocer said in a telephone interview with Reuters.
Thomson Reuters said it would seek shareholder approval for the London and NASDAQ delistings on 7 August.
"In a global electronic world where shares are trading in ones and zeros ... where we trade our shares is, to me, plumbing," Glocer said. "I think we shouldn't get too hung up ... London is still the second largest centre that we've got."
Thomson Reuters shares closed down 78 cents to C$33.53 on the Toronto Stock Exchange and down 94 cents at $29.08 on the New York Stock Exchange.
● SOURCE Reuters
The company said it would also remove its shares from NASDAQ and remain listed only on the New York and Toronto exchanges.
Chief executive Tom Glocer played down concerns that Thomson Reuters could lose any UK-based shareholders through the action, noting that only five per cent of all shareholders are in the United Kingdom. He expressed hope that those shareholders would retain their holdings even after the delisting.
"Our shares are now fragmented, divided between North America and London in a way we didn't envision. That's hurting the company because there are investors who would come in but won't," Glocer said in a telephone interview with Reuters.
Thomson Reuters said it would seek shareholder approval for the London and NASDAQ delistings on 7 August.
"In a global electronic world where shares are trading in ones and zeros ... where we trade our shares is, to me, plumbing," Glocer said. "I think we shouldn't get too hung up ... London is still the second largest centre that we've got."
Thomson Reuters shares closed down 78 cents to C$33.53 on the Toronto Stock Exchange and down 94 cents at $29.08 on the New York Stock Exchange.
● SOURCE Reuters
Thomson Reuters to end London share listing - FT
Monday 22 June 2009
Thomson Reuters has decided to end the London listing for its shares, the Financial Times reported.
The board discussed the decision on Monday afternoon, the newspaper said in a report from New York. It is subject to shareholder and court approval.
Thomson Reuters needs 75 per cent majority approval from shareholders to replace the current UK-listed shares and their related US-listed American Depositary Receipts with a single Toronto listing.
The FT said the switch will be conducted through a scheme of arrangement in a manner designed to avoid tax penalties for shareholders and should be completed by the end of September if shareholders and courts give their approval.
It would end a period marked by large valuation gaps between the London and Toronto listings since the dual structure was put in place when Thomson took over Reuters in April 2008.
The UK shares currently trade 10 per cent below the North American stock and 95 per cent of the company is now held by non-UK shareholders, the FT said.
“By improving liquidity in the Canadian stock, which includes most of the Thomson family’s controlling 55 per cent stake, the group hopes to improve its appeal to investors and its chances of raising capital if needed in future,” the FT said.
“The company has been conscious of the long history of Reuters in London, which dates back to Paul Julius Reuter’s pioneering use of carrier pigeons and submarine telegraph cables in the 1850s.
“However, people close to the company told the Financial Times that the change would not affect its sizeable Thomson Reuters markets business in London, nor headcount at its professional division…”
The company could save about $10 million in accounting, legal and other costs associated with the UK listing, they estimated.
The FT said that just 25 per cent of the London listed shares are now in the hands of UK institutions, down from over 50 per cent, of which roughly half were active investors and the other half index tracking funds.
The group expects index trackers and some UK active investors to come out of the stock, but its greater weighting in the Toronto index should in part offset any flow-back issues.
● SOURCE Financial Times
The board discussed the decision on Monday afternoon, the newspaper said in a report from New York. It is subject to shareholder and court approval.
Thomson Reuters needs 75 per cent majority approval from shareholders to replace the current UK-listed shares and their related US-listed American Depositary Receipts with a single Toronto listing.
The FT said the switch will be conducted through a scheme of arrangement in a manner designed to avoid tax penalties for shareholders and should be completed by the end of September if shareholders and courts give their approval.
It would end a period marked by large valuation gaps between the London and Toronto listings since the dual structure was put in place when Thomson took over Reuters in April 2008.
The UK shares currently trade 10 per cent below the North American stock and 95 per cent of the company is now held by non-UK shareholders, the FT said.
“By improving liquidity in the Canadian stock, which includes most of the Thomson family’s controlling 55 per cent stake, the group hopes to improve its appeal to investors and its chances of raising capital if needed in future,” the FT said.
“The company has been conscious of the long history of Reuters in London, which dates back to Paul Julius Reuter’s pioneering use of carrier pigeons and submarine telegraph cables in the 1850s.
“However, people close to the company told the Financial Times that the change would not affect its sizeable Thomson Reuters markets business in London, nor headcount at its professional division…”
The company could save about $10 million in accounting, legal and other costs associated with the UK listing, they estimated.
The FT said that just 25 per cent of the London listed shares are now in the hands of UK institutions, down from over 50 per cent, of which roughly half were active investors and the other half index tracking funds.
The group expects index trackers and some UK active investors to come out of the stock, but its greater weighting in the Toronto index should in part offset any flow-back issues.
● SOURCE Financial Times
Thomson Reuters Q1 profit beats forecasts
Thursday 07 May 2009
Thomson Reuters reported better-than-expected first quarter profit on Thursday as it kept a tight control on costs. The company reaffirmed its expectation that revenue will grow this year.
CEO Tom Glocer said the climate in the market had improved but not enough to rule out further weakness.
"I can't really call exactly where the bottom is. There can be false dawns. Right now sentiment is quite good in the market. We see them opening up their purse strings just a little bit," he said.
The London-listed shares closed a tad under 44 pence lower at 1,812 pence, down 2.37 per cent, after hitting a record high of 1,939 before the results were released.
Greater losses were registered in New York and Toronto.
In New York, Thomson Reuters shares closed 5.73 per cent lower at $29.77, a loss of $1.81.
On NASDAQ, the shares closed at $161.51, down $7.98 or 4.71 per cent.
In Toronto, the fall was 4.75 per cent or C$1.75 to a close of C$35.08.
Thomson Reuters’ Q1 net income was $228 million, or 27 cents a share, compared with $194 million, or 30 cents a share, a year ago.
Underlying operating profit, excluding amortisation, integration costs and other items, rose two per cent to $588 million, or 40 cents per share, beating the average analyst forecast of 34 cents per share.
Revenue from ongoing businesses was $3.12 billion, down three per cent from a year ago but up three per cent before currency effects. Analysts on average were expecting revenue of $3.17 billion.
The company reaffirmed its outlook for revenue to grow in 2009, and for underlying operating margin and free cash flow to be comparable to 2008, supported by revenue growth and the expected savings from integration programmes.
Thomson Reuters has said it expects annualised cost savings of $1 billion by the end of 2011, and Glocer said that while this was a good target, he did not rule out more.
Revenue in the Markets division, which supplies news and data to financial institutions, fell seven per cent to $1.85 billion, hurt by lower transaction volumes and job cuts. But the revenue would have risen 0.4 per cent before currency effects.
Though the outlook has brightened in recent weeks, financial institutions have been hit by closures, mergers and deep job cuts, and Reuters reported that the company is regarded by some analysts as the riskiest bet among professional information providers due to its exposure to the financial sector for about 60 per cent of group sales.
But strong execution, a high proportion of subscription and digital revenues, and the resilience of the Professional unit have helped to drive up Thomson Reuters London-listed shares by more than 20 per cent in the year to date.
Revenue at the Professional division, which supplies information to lawyers, scientists, accountants and the healthcare industry, rose two per cent to $1.27 billion, or five per cent excluding currency effects.
Glocer told the Financial Times that Thomson Reuters can take market share from rivals once turbulent financial and legal markets revive.
Bloomberg’s fall in terminal numbers by 2.5 per cent since November suggested “a much stronger descent than we’re seeing” in the markets business where they compete, Glocer said. “I certainly feel we’re at least holding our own.”
Much of the market share gains the group foresees would come from taking over the “do-it-yourself” data efforts of large banks and other customers, he said. Subscriptions had risen by two per cent in the markets business, while transaction revenues had fallen, but would rebound quickly in a recovery, he added.
“It feels like sentiment has changed in the last month,” Glocer told the FT, “but we don’t run our business on the basis that we need to clutch at green shoots.”
Robert Daleo, chief financial officer, said savings from integration were ahead of plan, adding that when combined with earlier initiatives these were on track to meet a $1.4 billion target by 2011.
● CLICK to read a transcript of the analysts’ webcast by Tom Glocer and Robert Daleo.
● SOURCE Reuters | Financial Times
CEO Tom Glocer said the climate in the market had improved but not enough to rule out further weakness.
"I can't really call exactly where the bottom is. There can be false dawns. Right now sentiment is quite good in the market. We see them opening up their purse strings just a little bit," he said.
The London-listed shares closed a tad under 44 pence lower at 1,812 pence, down 2.37 per cent, after hitting a record high of 1,939 before the results were released.
Greater losses were registered in New York and Toronto.
In New York, Thomson Reuters shares closed 5.73 per cent lower at $29.77, a loss of $1.81.
On NASDAQ, the shares closed at $161.51, down $7.98 or 4.71 per cent.
In Toronto, the fall was 4.75 per cent or C$1.75 to a close of C$35.08.
Thomson Reuters’ Q1 net income was $228 million, or 27 cents a share, compared with $194 million, or 30 cents a share, a year ago.
Underlying operating profit, excluding amortisation, integration costs and other items, rose two per cent to $588 million, or 40 cents per share, beating the average analyst forecast of 34 cents per share.
Revenue from ongoing businesses was $3.12 billion, down three per cent from a year ago but up three per cent before currency effects. Analysts on average were expecting revenue of $3.17 billion.
The company reaffirmed its outlook for revenue to grow in 2009, and for underlying operating margin and free cash flow to be comparable to 2008, supported by revenue growth and the expected savings from integration programmes.
Thomson Reuters has said it expects annualised cost savings of $1 billion by the end of 2011, and Glocer said that while this was a good target, he did not rule out more.
Revenue in the Markets division, which supplies news and data to financial institutions, fell seven per cent to $1.85 billion, hurt by lower transaction volumes and job cuts. But the revenue would have risen 0.4 per cent before currency effects.
Though the outlook has brightened in recent weeks, financial institutions have been hit by closures, mergers and deep job cuts, and Reuters reported that the company is regarded by some analysts as the riskiest bet among professional information providers due to its exposure to the financial sector for about 60 per cent of group sales.
But strong execution, a high proportion of subscription and digital revenues, and the resilience of the Professional unit have helped to drive up Thomson Reuters London-listed shares by more than 20 per cent in the year to date.
Revenue at the Professional division, which supplies information to lawyers, scientists, accountants and the healthcare industry, rose two per cent to $1.27 billion, or five per cent excluding currency effects.
Glocer told the Financial Times that Thomson Reuters can take market share from rivals once turbulent financial and legal markets revive.
Bloomberg’s fall in terminal numbers by 2.5 per cent since November suggested “a much stronger descent than we’re seeing” in the markets business where they compete, Glocer said. “I certainly feel we’re at least holding our own.”
Much of the market share gains the group foresees would come from taking over the “do-it-yourself” data efforts of large banks and other customers, he said. Subscriptions had risen by two per cent in the markets business, while transaction revenues had fallen, but would rebound quickly in a recovery, he added.
“It feels like sentiment has changed in the last month,” Glocer told the FT, “but we don’t run our business on the basis that we need to clutch at green shoots.”
Robert Daleo, chief financial officer, said savings from integration were ahead of plan, adding that when combined with earlier initiatives these were on track to meet a $1.4 billion target by 2011.
● CLICK to read a transcript of the analysts’ webcast by Tom Glocer and Robert Daleo.
● SOURCE Reuters | Financial Times
Thomson Reuters' UK shares hit record high
Tuesday 05 May 2009
Thomson Reuters’ London shares closed at a record high on Tuesday.
The stock ended the day up 95 pence – 5.43 per cent – at 1845 pence on the London Stock Exchange.
Percentage increases in North America were modest.
On the New York Stock Exchange, the share was six cents higher – 0.20 per cent – at $30.70.
On NASDAQ, the increase was $2.45 – 1.49 per cent – to $166.45.
In Toronto, the increase was C$0.16 – 0.44 per cent – to C$36.15.
The stock ended the day up 95 pence – 5.43 per cent – at 1845 pence on the London Stock Exchange.
Percentage increases in North America were modest.
On the New York Stock Exchange, the share was six cents higher – 0.20 per cent – at $30.70.
On NASDAQ, the increase was $2.45 – 1.49 per cent – to $166.45.
In Toronto, the increase was C$0.16 – 0.44 per cent – to C$36.15.
Goldman Sachs cuts Thomson Reuters to 'sell'
Thursday 16 April 2009
Goldman Sachs cut its rating on Thomson Reuters to “sell” from “neutral” on Thursday, sending the shares lower in London and New York.
The influential US investment bank believes the group’s financial information business – the Markets division – will suffer a significant deterioration in sales this year.
Citing another round of job cuts at leading investment banks, Goldman said: “We believe Markets will see significant deterioration in 1Q to -3 per cent and for the full year to -8 per cent, compared with full-year consensus forecasts of -4 per cent.”
At one point the London shares touched 1,611 pence, but then closed at 1,656 – 9.30% below their 52-week high of 1,826 pence set a year ago. The 52-week low is 883 pence.
Tomorrow is the first anniversary of Thomson Corp’s takeover of Reuters.
Over the last week Thomson Reuters has underperformed the FTSE 100 index. Over all other time periods it outperformed the index.
Closing prices:
LONDON: TRIL.L up 0.98 per cent to 1656p.
NEW YORK: TRI down 1.70 per cent to $27.19.
TORONTO: TRI.TO down 1.29 per cent to C$32.90.
NASDAQ: TRIN up 0.60 per cent to $149.41.
● SOURCE Financial Times
The influential US investment bank believes the group’s financial information business – the Markets division – will suffer a significant deterioration in sales this year.
Citing another round of job cuts at leading investment banks, Goldman said: “We believe Markets will see significant deterioration in 1Q to -3 per cent and for the full year to -8 per cent, compared with full-year consensus forecasts of -4 per cent.”
At one point the London shares touched 1,611 pence, but then closed at 1,656 – 9.30% below their 52-week high of 1,826 pence set a year ago. The 52-week low is 883 pence.
Tomorrow is the first anniversary of Thomson Corp’s takeover of Reuters.
Over the last week Thomson Reuters has underperformed the FTSE 100 index. Over all other time periods it outperformed the index.
Closing prices:
LONDON: TRIL.L up 0.98 per cent to 1656p.
NEW YORK: TRI down 1.70 per cent to $27.19.
TORONTO: TRI.TO down 1.29 per cent to C$32.90.
NASDAQ: TRIN up 0.60 per cent to $149.41.
● SOURCE Financial Times
Woodbridge signals it may sell Toronto shares, buy London ones
Thursday 26 February 2009
Woodbridge, the Thomson family's investment vehicle that controls more than half of Thomson Reuters shares, signalled on Thursday it may sell some of its shares traded in Toronto for those traded in London.
The company announced in Toronto that it had made a Canadian regulatory filing that would permit it to undertake transactions providing for sales of up to 10 million additional Thomson Reuters Corporation common shares (representing approximately two per cent of its holdings of Thomson Reuters Corporation common shares) and purchases of a similar number of Thomson Reuters PLC ordinary shares.
The filing does not commit Woodbridge to undertake any of these transactions. Woodbridge previously announced and completed similar transactions in the fourth quarter of 2008.
Any share sales would be through the Toronto Stock Exchange within 30 days. Purchases would be through the London Stock Exchange.
One ordinary share of Thomson Reuters PLC is equivalent to one common share of Thomson Reuters Corporation under Thomson Reuters dual listed company structure. As of yesterday, Woodbridge and other companies affiliated with it beneficially owned an aggregate of 439,767,486 Thomson Reuters Corporation common shares and 15,375,287 Thomson Reuters PLC ordinary shares (including ordinary shares underlying Thomson Reuters PLC American Depositary Shares) and had a voting interest in Thomson Reuters of approximately 55 per cent.
The London listing has traded at a discount to the North American quotes since Thomson's takeover of Reuters was completed last April.
The company announced in Toronto that it had made a Canadian regulatory filing that would permit it to undertake transactions providing for sales of up to 10 million additional Thomson Reuters Corporation common shares (representing approximately two per cent of its holdings of Thomson Reuters Corporation common shares) and purchases of a similar number of Thomson Reuters PLC ordinary shares.
The filing does not commit Woodbridge to undertake any of these transactions. Woodbridge previously announced and completed similar transactions in the fourth quarter of 2008.
Any share sales would be through the Toronto Stock Exchange within 30 days. Purchases would be through the London Stock Exchange.
One ordinary share of Thomson Reuters PLC is equivalent to one common share of Thomson Reuters Corporation under Thomson Reuters dual listed company structure. As of yesterday, Woodbridge and other companies affiliated with it beneficially owned an aggregate of 439,767,486 Thomson Reuters Corporation common shares and 15,375,287 Thomson Reuters PLC ordinary shares (including ordinary shares underlying Thomson Reuters PLC American Depositary Shares) and had a voting interest in Thomson Reuters of approximately 55 per cent.
The London listing has traded at a discount to the North American quotes since Thomson's takeover of Reuters was completed last April.
Tom Glocer says Thomson Reuters set for growth in 2009
Thursday 29 January 2009
Thomson Reuters continues to see bright spots in its financial services unit and the company is still set for growth this year, CEO Tom Glocer said on Thursday.
Even though there were big job losses across the financial services industry there would still need to be hirings in new areas, he told Reuters correspondent Mike Dolan at the annual meeting of the World Economic Forum in Davos, Switzerland.
"The trading of very opaque assets with very wide spreads, I think we'll see those sorts of over-the-counter markets evolve," Glocer said, adding that there will be a need for pricing feeds and infrastructure to accurately price those assets.
"I don't think anybody who's here can in their right mind be optimistic about 2009, either from a global economy point of view or in financial services," he said.
But "in our financial services unit ... we continue to see bright spots right across the world. I'm feeling good about the business.”
Thomson Reuters makes about 60 per cent of revenues and 45 per cent of profits from its markets division, whose customers are mainly banks.
"There's no question that growth has been tempering, it's been coming down,” Glocer said. “But for the company as a whole, we continue to talk about growth in 2009."
He said the integration after Thomson Corp’s $11 billion takeover of Reuters in April 2008 was "going very well".
He also said the company would keep the different listings of its stock in London, Toronto and New York as long as investors demanded it.
"The London listing was left in place to meet the demand. As long as that's the case, there's certainly a rationale for maintaining the listing," he said.
Investors have speculated that the company may drop its London listing as a price gap that opened up on the first day of trading in Thomson Reuters shares in Toronto and London widens.
● SOURCE Reuters
Woodbridge signals Thomson Reuters share swap
Friday 21 November 2008
Woodbridge, the Thomson family’s investment vehicle and controlling shareholder of Thomson Reuters, signalled on Friday it may be about to exchange Thomson Reuters Corporation shares for shares in Thomson Reuters PLC.
Under a Canadian regulatory filing in Toronto, Woodbridge would sell up to 15 million common shares in the corporation on the Toronto Stock Exchange and concurrently buy a similar number of ordinary shares in the PLC on the London Stock Exchange.
Woodbridge and other companies affiliated with it beneficially own an aggregate of 444,780,673 Thomson Reuters Corporation shares and 8,334,812 Thomson Reuters PLC ordinary shares. Its voting interest in Thomson Reuters is approximately 55 per cent.
● SOURCE Fox Business
Under a Canadian regulatory filing in Toronto, Woodbridge would sell up to 15 million common shares in the corporation on the Toronto Stock Exchange and concurrently buy a similar number of ordinary shares in the PLC on the London Stock Exchange.
Woodbridge and other companies affiliated with it beneficially own an aggregate of 444,780,673 Thomson Reuters Corporation shares and 8,334,812 Thomson Reuters PLC ordinary shares. Its voting interest in Thomson Reuters is approximately 55 per cent.
● SOURCE Fox Business
Thomson family may increase its stake
Saturday 20 September 2008
The Thomson family signalled it may slightly increase its voting interest in Thomson Reuters. In a regulatory filing on Friday, the family said it may sell as many as 10 million of the common shares listed on the Toronto Stock Exchange and spend the proceeds on ordinary shares listed on the London Stock Exchange.
Woodbridge, the Thomson family’s holding company, said the move was being made to facilitate trading in the stocks.
Based on current prices, the transaction would result in a slight increase in Woodbridge’s 55 per cent voting interest, it said.
Since Thomson’s takeover of Reuters in April, London shares of the new dual-listed company have traded at a large discount to those in Toronto.
● SOURCE The Gazette (Montreal)
Woodbridge, the Thomson family’s holding company, said the move was being made to facilitate trading in the stocks.
Based on current prices, the transaction would result in a slight increase in Woodbridge’s 55 per cent voting interest, it said.
Since Thomson’s takeover of Reuters in April, London shares of the new dual-listed company have traded at a large discount to those in Toronto.
● SOURCE The Gazette (Montreal)
Share buyback scheme extended
Wednesday 04 June 2008
Thomson Reuters said on Wednesday it had received approval from the Toronto Stock Exchange (TSX) to renew a US$500 million stock buyback programme for a further 12 months.
The programme will end on 5 June 2009. Shares can be bought on either the TSX or the New York Stock Exchange.
Under the bid, up to 15 million common shares can be repurchased, representing 1.81 per cent of Thomson Reuters’ outstanding shares on 30 May.
Thomson Reuters began purchasing ordinary shares of Thomson Reuters PLC on 18 April, the day after the formation of the merged company. Approximately 9.6 million Thomson Reuters PLC ordinary shares were purchased for a total cost of about US$302 million from 18 April to 30 May.
Thomson Reuters shares listed in London are trading at a 16 per cent discount to those in New York and Toronto.
● SOURCE Thomson Reuters | Financial Post | Seeking Alpha
The programme will end on 5 June 2009. Shares can be bought on either the TSX or the New York Stock Exchange.
Under the bid, up to 15 million common shares can be repurchased, representing 1.81 per cent of Thomson Reuters’ outstanding shares on 30 May.
Thomson Reuters began purchasing ordinary shares of Thomson Reuters PLC on 18 April, the day after the formation of the merged company. Approximately 9.6 million Thomson Reuters PLC ordinary shares were purchased for a total cost of about US$302 million from 18 April to 30 May.
Thomson Reuters shares listed in London are trading at a 16 per cent discount to those in New York and Toronto.
● SOURCE Thomson Reuters | Financial Post | Seeking Alpha
Montreal bureau closes
Wednesday 28 May 2008
Thomson Reuters closed its Montreal bureau with immediate effect, affecting one journalist and several sales people, The Canadian Press reported.
It said the news was given in an internal e-mail circulated to staff on Tuesday.
Most of the company’s Canadian workforce is located in Toronto.
● SOURCE Canadian Press
It said the news was given in an internal e-mail circulated to staff on Tuesday.
Most of the company’s Canadian workforce is located in Toronto.
● SOURCE Canadian Press
TRI/TRIL - an arbitrageur’s dream
Tuesday 13 May 2008
The gap between the prices of Thomson Reuters’ dual-listed shares in London and Toronto has lingered longer than expected, The Globe and Mail said on Tuesday.
When the two shares began trading separately on 17 April and the UK shares (stock symbol TRIL) lagged their Canadian counterpart (stock symbol TRI) by a significant margin logic suggested it would only be a matter of time before they eventually settled at a similar level, since both represent an equal investment in the same assets.
“But for reasons that escape the company and have left investors scratching their heads, the gap between the two has lingered longer than expected – nearly a month...” the newspaper said.
“With that in mind, arbitrageurs are buying the UK-traded Thomson Reuters PLC shares, while shorting Thomson Reuters Corp on the Toronto Stock Exchange, hoping to capitalize on the gap.”
Short selling involves borrowing and then selling shares in a company in expectation of buying them back at a lower price and profiting on the difference.
The Globe and Mail said that once exchange rates are factored in the London shares have been trading at roughly 15-20 per cent less than the Toronto listing.
Company executives acknowledged the discrepancy at the new company’s annual meeting last week in Toronto. But chief financial officer Robert Daleo declined to guess why the discount exists, the newspaper said.
“We do know that there are a lot of shorts that were put on the Thomson stock that have to be unwound and they have to do it over time, so it could take a while,” he was quoted as saying.
“Markets are generally rational, so it may take a little while longer,” he said. “How long? We have no idea. We do know that [the UK price] doesn’t represent the true intrinsic value of the company.”
One arbitrage player who has taken a position in both shares hoping to profit when the gap narrows is New York-based money manager Glazer Capital. Its president, Paul Glazer, is reported to have written more than 80 letters to executives of 14 large institutional investors in Canada, hoping to prod them into buying the UK shares.
“Given that the Canadian and UK shares are, by design, economically equivalent to each other, it defies all financial theory that the shares of one holding company should trade at a 20-per-cent-plus premium to the others that are just as easily obtained,” the newspaper quoted the letter as saying.
“It is hard to explain why a holder of [the Toronto listing] could not sell these shares and buy a 20-per-cent larger interest in the same company by using the proceeds to buy [the UK traded] shares.”
● SOURCE The Globe and Mail
When the two shares began trading separately on 17 April and the UK shares (stock symbol TRIL) lagged their Canadian counterpart (stock symbol TRI) by a significant margin logic suggested it would only be a matter of time before they eventually settled at a similar level, since both represent an equal investment in the same assets.
“But for reasons that escape the company and have left investors scratching their heads, the gap between the two has lingered longer than expected – nearly a month...” the newspaper said.
“With that in mind, arbitrageurs are buying the UK-traded Thomson Reuters PLC shares, while shorting Thomson Reuters Corp on the Toronto Stock Exchange, hoping to capitalize on the gap.”
Short selling involves borrowing and then selling shares in a company in expectation of buying them back at a lower price and profiting on the difference.
The Globe and Mail said that once exchange rates are factored in the London shares have been trading at roughly 15-20 per cent less than the Toronto listing.
Company executives acknowledged the discrepancy at the new company’s annual meeting last week in Toronto. But chief financial officer Robert Daleo declined to guess why the discount exists, the newspaper said.
“We do know that there are a lot of shorts that were put on the Thomson stock that have to be unwound and they have to do it over time, so it could take a while,” he was quoted as saying.
“Markets are generally rational, so it may take a little while longer,” he said. “How long? We have no idea. We do know that [the UK price] doesn’t represent the true intrinsic value of the company.”
One arbitrage player who has taken a position in both shares hoping to profit when the gap narrows is New York-based money manager Glazer Capital. Its president, Paul Glazer, is reported to have written more than 80 letters to executives of 14 large institutional investors in Canada, hoping to prod them into buying the UK shares.
“Given that the Canadian and UK shares are, by design, economically equivalent to each other, it defies all financial theory that the shares of one holding company should trade at a 20-per-cent-plus premium to the others that are just as easily obtained,” the newspaper quoted the letter as saying.
“It is hard to explain why a holder of [the Toronto listing] could not sell these shares and buy a 20-per-cent larger interest in the same company by using the proceeds to buy [the UK traded] shares.”
● SOURCE The Globe and Mail
Bridging the Thomson Reuters gap
Tuesday 06 May 2008
Shares of Thomson Reuters listed in London continue to trade at a huge discount to those listed in Toronto, the Financial Times reported. Dual-listed shares rarely trade perfectly efficiently, the FT’s Lex column said, but a gap of this scale, about one fifth, is unheard of.
Technical factors are at play, the FT said. As Thomson Reuters is a dual-listed company, the only way to unwind the classic merger arbitrage trade – long Reuters, short Thomson – is to sell the shares in London and buy in Toronto. Yet the shortage of buyers in London also reflects very different views of the new company’s prospects.
Traditional Canadian holders of Thomson still view it as a defensive professional publisher while the view from London is that the Canadians have no idea what is about to hit them, the FT said. Reuters is still seen as a hostage to the fortunes of its primary customers, the investment banks. “During the last downturn it was clobbered.”
Chief executive Tom Glocer hopes to work on UK shareholders, the FT said. “Either they don’t get the professional side of the business, or they understand the financials side all too well,” it added.
● SOURCE Financial Times
Technical factors are at play, the FT said. As Thomson Reuters is a dual-listed company, the only way to unwind the classic merger arbitrage trade – long Reuters, short Thomson – is to sell the shares in London and buy in Toronto. Yet the shortage of buyers in London also reflects very different views of the new company’s prospects.
Traditional Canadian holders of Thomson still view it as a defensive professional publisher while the view from London is that the Canadians have no idea what is about to hit them, the FT said. Reuters is still seen as a hostage to the fortunes of its primary customers, the investment banks. “During the last downturn it was clobbered.”
Chief executive Tom Glocer hopes to work on UK shareholders, the FT said. “Either they don’t get the professional side of the business, or they understand the financials side all too well,” it added.
● SOURCE Financial Times
