Reports Say Reuters Trustees to Support Thomson Takeover

A number of media reports over the weekend citing close sources, claim the Reuters Founders Share Company [RFSC] -- which has a "golden share" allowing it to block any party from obtaining more than 15% in Reuters Group -- is expected to support Thomson Corp's takeover bid of nearly ₤8.8 billion ($17.4b). A joint formal announcement could happen as early as this week, according to sources. Reuters says a spokeswoman for the chairman of RFSC was unavailable for comment and Thomson declined to comment. Ordinary shares of Reuters were down 1.1% to 606.25 pence in morning trading Monday in London. Its ADRs gained 2.4% to $72.74 in normal trading on Friday, while shares of Thomson climbed 3.6% to $42.02. Media reports continue to mention concern over industry consolidation among some of the firms' (including Bloomberg) data clients, since a combined Thomson-Reuters would have 34% market share or 1% more than Bloomberg, according to Inside Market Data. Separately, Thomson has agreed to sell education and publishing-related assets for $7.75b to a private equity group and a Canadian pension plan.

Sources: Reuters, Thomson-AFX newswire, Associated Press
Commentary: Thomson Shares Should Rise 20% on Reuters Buyout - Barron's • Deutsche Bank: Thomson-Reuters Combo Would Have Leakage, Be Anti-trust Risk • Reuters, Thomson Confirm They Are Negotiating $17.5 Billion Deal
Stocks/ETFs to watch: Reuters Group plc [ADR] (RTRSY), The Thomson Corporation (TOC). Competitors: Dow Jones & Co. Inc. (DJ), FactSet Research Systems (FDS), The New York Times Co. (NYT), News Corp. (NWS)

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