Dow Jones to purchase Reuters' interest in Factiva.Dow Jones Dow Jones the best known of several U.S. indexes of movements in price on Wall Street. [Am. Hist.: Payton, 202] See : Finance & Company (New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of ) has signed an agreement to acquire Reuters' 50% interest in Factiva (New York), bringing Dow Jones ownership of Factiva to 100%. Dow Jones will pay a $160 million purchase price, including $153 million in cash plus $7 million in preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. issued by Factiva. In addition, Dow Jones will make annual payments over the next 3.5 years under a variety of agreements with an estimated value of about $25 million. Dow Jones said the cash portion of the purchase price will be funded with proceeds of the proposed sale of up to six Ottoway local newspapers. Factiva will have estimated revenue of approximately $290 million in 2006 and recurring EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become of $27 million. On a pro-forma basis, excluding payments to Reuters and including synergies with the Dow Jones Enterprise Media Group, Factiva is estimated to generate $290 million in revenue, about $50 million of pro-forma EBITDA and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of about $32 million. Established in 1999 as a joint venture between Dow Jones and Reuters, Factiva is a provider of global business content, research products and services to global enterprises mainly in the finance, corporate, professional services and government sectors. It combines news and information from more than 10,000 sources from 152 countries, including "The Wall Street Journal," "The Financial Times," 370 continuously updated newswires, including Dow Jones, Associated Press, Agence France Presse and Reuters newswires, as well as business and financial magazines, Reuters fundamentals, media transcripts and D&B company profiles. The company has 1.6 paying subscribers and approximately 750 employees. Dow Jones aid the acquisition will remove certain joint venture conditions that limit Factiva's business opportunities in and its core enterprise market and that removing those restrictions will allow Factiva to develop applications with Dow Jones Newswires Dow Jones Newswires is the real-time financial news organization owned by Dow Jones. Founded in 1882, its primary competitors are Bloomberg L.P. and Reuters. The company reports more than 420,000 subscribers -- including brokers, traders, analysts and fund managers -- as of July and Dow Jones Licensing Services "that better target the financial services market." DJ Enterprise Media Group CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Rich Zannino said the purchase "will accelerate the pursuit of our mission, which is to be the world's best publisher of high quality, indispensable and conveniently accessible business and related content across all media channels." |
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