GIC to be part of Blackstone-led group to buy Thomson Reuters unit
Sovereign wealth fund GIC has joined a Blackstone-led consortium to take a majority stake in the financial and risk business of news group Thomson Reuters.
The Blackstone-led consortium will own 55 per cent of the equity in a new corporation created to hold the business, in a stake valued at US$11 billion (S$14 billion).
Thomson Reuters will retain a 45 per cent holding valued at US$9 billion, with the overall valuation of the company at US$20 billion.
The financial and risk business provides information and data analytics and enables financial transactions. It is used by trading, investment, financial and corporate professionals. It also provides regulatory and risk management solutions.
It will enter into a 30-year contract for the exclusive rights to distribute Reuters News through all its products.
Reuters News will continue to remain a part of Thomson Reuters and will not be included in the assets being acquired.
The transaction is expected to close in the second half of the year.
Mr Choo Yong Cheen, chief investment officer of Private Equity at GIC, said: "As a long-term value investor, we believe this business transformation will enable (the new entity) to focus on its core customer base and be in a strong position to continue delivering innovative products to the market."
Ms Mia Zhang, a consultant at Frost & Sullivan, believes the deal is a "good investment bet" for GIC: "The returns are expected to be steady, while the risks are low."
The deal will see Blackstone compete with services such as Bloomberg, whose terminals are the market leader in providing the financial sector with news, data and analytics.