UPDATE: Thomson Reuters To Sell Health-Care Unit For $1.25 Billion
April 23 2012 - 10:46AM
Dow Jones News
Thomson Reuters Corp. (TRI, TRI.T) will sell its health-care
business to private-equity firm Veritas Capital for $1.25 billion
in an all-cash deal that will help the data and analytics provider
focus more on its struggling core financial-markets business.
The sale to Veritas came after Thomson Reuters said it was
re-launching a sales process for the unit earlier this year. In
2011, an initial auction process drew insufficient interest in
volatile markets.
"With the completion of the divestiture, Thomson Reuters will be
even more focused on our core global businesses," Chief Executive
James C. Smith said.
Thomson Reuters unveiled a restructuring of its markets business
last year amid disappointing early sales of a new markets desktop
product called Eikon. It also underwent a major reshuffling of its
top leadership ranks, including the departures of several
high-level executives. Analysts have voiced concerns about the
company's dependence on financial-markets clients at a time when
banks are cutting costs because of new regulation and uncertain
markets.
Thomson Reuters shares fell 1.9% to $28.32 amid a broader market
selloff Monday; the shares are down around 31% over the past
year.
The health-care business provides data, analytics and other
services on the health-care industry to companies, government
agencies and health-care professionals.
The sale, subject to the approval of regulators, is expected to
close in the next few months.
As part of broader efforts to refocus its business, Thomson
Reuters in February disclosed plans to sell three smaller units,
which together accounted for about $155 million in revenue for
2011. The company has also said it was open to small, strategic
acquisitions.
Dow Jones Newswires and The Wall Street Journal compete with
Thomson Reuters' news service.
-By William Launder, Dow Jones Newswires; 212-416-3412;
william.launder@dowjones.com
--Mia Lamar contributed to this article.
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