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. Last Updated: 07/27/2016

Reuters, Thomson To Merge

LONDON -- Reuters Group and Thomson Corp. said Tuesday that they had agreed on terms for a merger to create one of the world's largest financial news providers.

The cash and stock transaction values Reuters at ?8.7 billion ($17.2 billion).

Holders of each Reuters share will be paid 352.5 pence ($6.99) in cash and 0.16 Thomson-Reuters shares.

The value of the deal is calculated based on Thomson's closing share price of 48.46 Canadian dollars ($44.05) on the Toronto Stock Exchange on May 3, the day before the companies announced that they were exploring a combination.

Thomson, formally based in Toronto but with its operational head office in Stamford, Connecticut, would control about 70 percent of the shares in the new company, Thomson-Reuters. The company will be headed by Tom Glocer, 47, who is now chief executive of Reuters.

The two companies expect to realize savings of ?250 million ($500 million) in savings by the third year.

Reuters trustees, who could have vetoed any takeover, endorsed the deal.

Reuters competes with Thomson and Bloomberg in providing data terminals to the world's major banks and brokerages. Reuters was the market leader for years before steadily losing ground to Bloomberg.

An April report from Inside Market Data Reference said Bloomberg had a 33 percent share of the market, with Reuters holding 23 percent and Thomson 11 percent.