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REUTERS PLANS TO DISTRIBUTE 350 MILLION POUNDS BY WAY OF SHARE REPURCHASE

 NEW YORK, July 26 /PRNewswire/ -- Reuters announces that it is proposing to distribute up to 350 million pounds sterling by way of a repurchase of approximately 5.8 percent of its issued ordinary shares (up to 25 million ordinary shares) at a price of 14 pounds per ordinary share. The price per ADS will be the U.S. dollar equivalent of 42 pounds per ADS, converted at a spot rate fixed shortly before payment. The repurchase will provide all shareholders with the opportunity to sell a proportion of their shares back to the company.
 Reuters will be releasing its interim results tomorrow (July 27, 1993) and documentation relating to the repurchase will be sent to shareholders the following day. Reuters is making this announcement in order to clarify the position following speculation in the press over the weekend.
 Sir Christopher Hogg, chairman, said:
 "Reuters has been highly cash generative during the 1990s. The board of Reuters has concluded that 350 million pounds of its cash resources is surplus to immediate requirements and should be returned to shareholders by means of a share repurchase. Whilst the main purpose of the repurchase is to provide shareholders with the opportunity either to receive a cash distribution or to have an equivalent enhancement of their investment in Reuters, the board believes that all shareholders will benefit from the repurchase since it should lead to an increase in Reuters earnings per share.
 "Reuters has demonstrated the ability to grow profits steadily during a prolonged recession in the course of which it has invested heavily in the competitiveness of its product line. The company is confident that the growth of global financial markets should continue to provide Reuters with significant investment opportunities and enable good returns.
 "The board believes that Reuters should continue to concentrate on specialist target markets which allow best use of the company's basic skills and maximum exploitation of its advanced technology platforms. Strategy will be unfolded in a measured manner designed to retain Reuters focus and ensure that its products will continue to be differentiated by their careful targeting and close technical integration."
 Peter Job, chief executive, added:
 "Reuters believes that the worldwide market for specialist information is increasing. We are confident that our expertise in newsgathering, database-building and global network management leaves us well-placed to meet the growing demand for sophisticated products in the financial services industry, in the media, and in other specialist markets which are expected to develop. Pioneering achievements in the area of electronic transactions should continue to give the company a competitive edge. Timely investments in video newsgathering and dissemination will allow Reuters to make the necessary enhancements to its product line as multi-media technology develops gradually into practical applications."
 The board's decision to reduce net cash balances through the proposed share repurchase follows a review of long-term requirements for capital for existing business, for internal investments in new programs, and for acquisitions. A realistic assessment of the timing of these requirements indicated that a sizable amount of Reuters cash would continue to benefit profits only by virtue of being invested in money markets and that current initiatives and plans could comfortably be funded from Reuters substantial financial resources and future cash flows.
 Structure of the repurchase
 The structure of the repurchase has been designed to accommodate differing U.K. and U.S. regulatory requirements and market practices and to accomplish a number of goals, including:
 -- to allow all shareholders to participate equally in the distribution of cash; and
 -- not to disadvantage shareholders who may wish to increase their proportionate interest in Reuters by maintaining their existing shareholding.
 Furthermore, the board of Reuters has been advised that such a repurchase should enable most shareholders to receive tax credits or refunds in relation to a substantial proportion of the purchase price. Arrangements have been made to enable holders of ADSs to receive a U.K. tax credit refund at the same time as they receive the purchase price. The repurchase will allow the company to utilize franked investment income arising from the 357 million pounds dividend paid by Reuters Limited to Reuters Holdings PLC in 1992.
 The basis of acceptance of tenders will ensure that all shareholders are able to sell to the company up to 5.84 percent of their shares and that , to the extent that some shareholders do not wish to participate in the repurchase, other shareholders will be able to have additional shares repurchased.
 Whilst the purpose of the repurchase is to allow participating shareholders to receive a cash distribution, the board believes that all shareholders will benefit from the repurchase which should lead to an increase in Reuters earnings per share.
 The tender offer
 The board of Reuters is proposing that the company should repurchase by way of a tender offer up to 5.84 percent of its issued ordinary shares (up to 25 million ordinary shares), including ordinary shares represented by ADSs. The price at which ordinary shares will be repurchased is 14 pounds per ordinary share and the U.S. dollar equivalent of 42 pounds per ADS. Holders of ordinary shares will receive payment for their shares in sterling on the U.K. settlement date (expected to be Sept. 13, 1993). Holders of ADSs will receive payment for their shares in U.S. dollars on the U.S. settlement date (expected to be Sept. 15, 1993). The sterling repurchase price will be converted into U.S. dollars by the U.S. Depositary in New York, as soon as practicable after receipt, at a spot rate on the U.K. settlement date for value on the U.S. settlement date. If the sterling repurchase price were converted at the noon buying rate on July 23, 1993, holders of ADSs would receive $62.85 per ADS.
 At the close of business in London on July 23, 1993 the price of the ordinary shares was 14.04 pounds and at the close of business in New York on the same date the reported last sale price of the ADSs on NASDAQ-NMS was $63-1/2. These prices include the right to receive the interim dividend to be announced tomorrow. (The 1992 interim dividend was 5.3 pence per ordinary share and 15.9 pence per ADS).
 Holders of ordinary shares will be entitled to receive the interim dividend to be announced tomorrow in respect of their entire holdings of ordinary shares (including those represented by ADSs) whether or not they tender any shares for repurchase.
 The tender offer is for up to 5.84 percent of Reuters issued ordinary shares (up to 25 million ordinary shares). Pursuant to the tender offer, each shareholder is invited to offer to sell shares to Reuters. The tender offer is open to all holders of shares and ADSs at the close of the tender period. Reuters cannot accept tenders unless a special resolution approving the proposed repurchase is passed. If tenders are accepted, the basis of acceptance will be as follows:
 -- each beneficial owner of shares will be entitled to sell to Reuters up to 5.84 percent of his or her beneficial holding (the "entitled amount"); and
 -- shareholders may also tender shares in excess of their entitled amounts, which will be accepted to the extent that other shareholders do not tender the whole of their entitled amounts. Such tenders will be accepted pro rata to the numbers of shares tendered in excess of the entitled mounts.
 The tender offer is conditional on Reuters having received valid tenders pursuant to the tender offer (which have not been withdrawn) in respect of not less than 4.25 million shares (approximately one percent of Reuters existing issued ordinary shares). This condition may be waived by Reuters.
 Documentation relating to the tender offer will be sent to shareholders on July 28, 1993.
 Shareholders who wish to tender some or all of their shares should complete a tender form, which must be received by 5 p.m. (London time), noon (New York time) on Wednesday, Aug. 25, 1993 unless this date is extended by Reuters. Tenders will be irrevocable from this time until settlement.
 Extraordinary General Meeting
 An extraordinary general meeting will be convened for Friday, Sept. 10, 1993 to consider and, if thought fit, pass a special resolution to approve the proposed repurchase.
 Reuters has been advised by S.G. Warburg & Co. Ltd. and J.P. Morgan.
 -0- 7/26/93
 /CONTACT: Rob Rowley, finance director and secretary, 071-324-7272, or Michael Cooling, corporate relations, 071-510-7427 or 071-510-7703, both of Reuters Holdings PLC; Michael Reilly, investor relations, 212-603-3580, or Robert Crooke, media relations, 212-603-3587, both of Reuters America; Robin Budenberg of S.G. Warburg & Co. Ltd., 071-860-1090; or Bruce Carnegie-Brown, 071-600-2300 or Joseph Evangelisti, 212-648-9357, both of J.P. Morgan/
 (RTRSY)


CO: Reuters ST: New York IN: PUB SU:

LG-WB -- NY010 -- 5554 07/26/93 09:23 EDT
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Date:Jul 26, 1993
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