Toronto, Mar 27 : The shareholders of the UK-based Reuters Group Plc and Canada-based Thomson Corp. have given their nod to a 17 billion dollar deal that will allow acquisition of Reuters by Thomson.
Thomson shareholders voted over 99 per cent in favour of the cash and stock deal at a meeting in Toronto and Reuters shareholders did the same in London.
According to an announcement made May last year, the transaction will create one of the world's biggest providers of legal, medical and financial data, holding roughly 34 per cent of the market and putting it in a race with U.S-based rival Bloomberg LP for the lead.
The Reuters purchase "gives us a global footprint that we've never really had as our own company," the Globe and Mail Update quoted Richard Harrington, chief executive officer of Thomson, as saying.
"Both companies are coming off record years and it's a great time to do this transaction," said Harrington, who is retiring after the merger.
Roy Thomson had bought the Timmins Press newspaper in 1934 for a few hundred dollars and eventually expanded his holdings into Thomson Corp., which operated over 200 papers throughout North America and the UK by the 1980s.
David Thomson, chairman of Thomson Corp. and the grandson of Roy Thomson, would become chairman of the new Thomson Reuters after the completion of deal on April 17.
"We are fully confident that we can create and build value in the business,"avid Thomson told shareholders in Toronto.
Reuters is the esteemed news and financial data empire that started in 1851 when Paul Julius Reuter began sending stock market information between London and Paris by carrier pigeon and cable.
Tom Glocer, chief executive officer of Reuters, will become the CEO of the combined Thomson Reuters after Harrington's retirement.
The deal had the backing of Thomson's largest shareholder, Woodbridge Co. Ltd., the private holding company of the Thomson family, and was also backed by the Reuters board.
Regulators in Europe, the U.S. and Canada recently cleared the takeover after a probe to ensure Thomson Reuters wouldn't hold too much dominance over the market for financial data.
In its approval, the U.S. Department of Justice required the companies to sell copies of four databases used to provide economic data and earnings forecasts. The divestitures would encourage new or smaller companies to compete in the industry, the regulator said in its ruling.
When the deal closes next month, Woodbridge's interest will shift from a 70 per cent holding in Thomson Corp. to a 53 per cent stake in the combinedhomson Reuters.
Reuters shareholders will hold 24 per cent of the company, while Thomson's other investors will comprise the remaining 23 per cent.
The companies will be listed dually as Thomson Reuters Corp. in North America and Thomson Reuters PLC in the U.K.
Thomson executives say the deal will give the company a stronger hold in emerging markets such as China and India.
Thomson Reuters expects to gain about 500-million dollars of annual savings by combining resources such as technology and product development three years after the deal closes.