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Thomson Reuters plans RM37b buyback post-Blackstone deal

Commuters walk past the JP Morgan, left, and Thomson Reuters Corp., right, buildings in the Canary Wharf business, financial and shopping district of London, U.K., on Wednesday, Oct. 28, 2015. In its monthly consumer confidence index, GfK said a measure of Britons' outlook for the economy over the next 12 months dropped to minus 4 in October, the lowest reading this year. Photographer: Simon Dawson/Bloomberg

By BLOOMBERG

LOS ANGELES • Thomson Reuters Corp announced plans to purchase as much as US$9 billion (RM36.99 billion) of its stock, rewarding shareholders after the sale of its financial and risk (F&R) operations to Blackstone Group LP.

The price range for the tender offer is US$42 to US$47 a share, Thomson Reuters said on Tuesday.

That represents a nearly 12% premium over the stock’s trading price over the past 20 trading days, according to a statement.

Woodbridge Co, a Thomson family- backed firm that is already the company’s biggest investor, will take part in the deal and maintain its current 64% stake.

In January, a group led by Blackstone agreed to buy a 55% stake in Thomson Reuters’ F&R division in a deal valued at about US$17 billion.

The unit, which provides data, analytics and trading to Wall Street and financial professionals around the world, doesn’t include the newsgathering operation.

“We are committed to returning a significant portion of the F&R transaction proceeds to our shareholders,” Thomson Reuters CEO Jim Smith said in a statement.

Thomson Reuters shares rose as much 7% to US$46.29 in New York on Tuesday. The company, which has a market value of US$31 billion, is also planning to return about US$1 billion to investors through regular buybacks. That means the total purchases would amount to about a third of its market capitalisation.

The so-called substantial issuer bid, or SIB, is slated to start on Tuesday and expire on Oct 2.

The Blackstone transaction is scheduled to close the previous day, and the SIB is dependent on that deal being completed.

Thomson Reuters will use a “modified Dutch auction”, giving shareholders more options about how much to sell and at what price.