Blackstone challenges Bloomberg with deal for $20bn Thomson Reuters arm
Private equity giant Blackstone has completed its biggest investment since the 2008 financial crisis by taking over Thomson Reuters' financial and risk unit.
The deal, which values the business at around $20bn (£15.5bn), sees the Blackstone-led consortium of private equity funds take a 55 per cent stake.
Thomson Reuters keeps 45 per cent of the business, which will be renamed Refinitiv.
The move will challenge Bloomberg, as Blackstone buys one of the world's largest financial markets data providers with more than 40,000 institutional customers in 190 countries.
As part of the deal, Refinitiv also agrees to pay $325m a year, for 30 years, to Reuters to help fund its news service.
Thomson Reuters gained about $17bn in gross cash proceeds as the deal closed. Around $10bn will be returned to shareholders, a further $4bn will be spent to redeem debt, with $2bn to fund acquisitions.
Refinitiv chief executive David Craig said: “This is a unique moment in our 160-year history as the financial and risk business of Thomson Reuters now steps forward as Refinitiv."
“We firmly believe that efficient, transparent and trusted markets are good for all and that Refinitiv’s role is at the heart of this, providing access to clean and consistent data on a global scale."
He added: "With the backing of our investors, Refinitiv will continue to deliver the critical data, insights and open technology infrastructure that the market has come to expect while driving progress for our customers across trading, risk, banking, wealth and investment management and in areas such as financial crime and ESG investment. We look forward to exciting times ahead.”
Blackstone becomes a partner to Thomson Reuters in a section of the business which has struggled with a shrinking customer base.
Ii plans to invest in Refinitiv's trading platforms, indices, risk management, and fighting financial crime.
Eli Nagler, a managing director at Blackstone, said: “We are excited to complete this transaction and look forward to supporting Refinitiv’s growth and continued technology advancements in the years ahead.”