Blackstone in talks to buy stake in Thomson Reuters unit
Thomson Reuters is in advanced discussions for a sale of part of its financial and risk business, its largest unit by revenues, to US private equity firm Blackstone.
The company confirmed in a statement on Tuesday that it was considering a sale of a stake in the business to Blackstone but would retain an interest in the unit. It will also retain full ownership of Reuters News and its legal, tax and accounting businesses.
The talks with Blackstone were for a 55 per cent stake in the financial and risk business, valuing the unit at $20bn, a person with knowledge of the matter said.
Thomson Reuters’ financial and risk unit provides data and analytics to investors and financial institutions. The unit contributed about $6.1bn in revenues to the company in 2016, accounting for more than half of total revenues that year, according to a financial statement.
One of the products within the unit, a data terminal called Eikon, has competed head to head with a similar terminal product from Bloomberg.
A memo to staff from Thomson Reuters president and chief executive Jim Smith, dated January 29, seen by the Financial Times, said a turnround in the financial and risk business had helped attract private equity interest in the unit.
“The progress we have made turning around the F&R business and its future potential are reflected by Blackstone’s interest,” the memo said.
The statement from Reuters noted that the talks with Blackstone may or may not lead to a definitive agreement.
As of September, Blackstone managed a record $387bn in assets under management, a 7 per cent rise over the prior year period. At the time it also reported better-than-expected earnings results as its real estate portfolio appreciated.