By Matt Scuffham
TORONTO (Reuters) - Thomson Reuters Corp is looking to make multiple acquisitions to boost its Legal and Tax & Accounting units after selling a majority stake in its financial terminal business, Chief Executive Jim Smith said on Tuesday.
The news and information provider has set aside $2 billion for deals, Smith told Reuters in an interview, after raising $17 billion from the sale of a 55 percent stake in its Financial & Risk (F&R) unit to private equity firm Blackstone Group LP.
"We are interested in bigger, more substantive deals," Smith said. "I wouldn't expect a string of small, bolt-on acquisitions. We'd rather spend that $2 billion on a handful of deals rather than spread across a couple of dozen."
The company had previously indicated that it wanted to use the funds to bolster its Legal and Tax & Accounting businesses, which are its two biggest units after the F&R deal. Last month, it agreed to buy Integration Point, a trade management software business, for an undisclosed fee.
The F&R unit now operates as a standalone business named Refinitiv.
Smith said the company was on track for a solid 2018 and a better performance in 2019. The company reiterated its forecast, originally given in May, for low single-digit revenue growth in 2018.
Its shares were unchanged in pre-market trading.
The company said it now expects adjusted earnings before interest, tax, depreciation and amortization (EBITDA) of $1.3 billion for the year, having previously said it expected $1.2 billion to $1.3 billion. The year ago figure was $1.6 billion. Smith said he expected underlying profit to improve next year.
For the third quarter, Thomson Reuters reported a smaller-than-expected fall in profit. Earnings per share were 11 cents, adjusted for one-time items, down from 27 cents a year ago, hurt by higher tax expense. That beat Wall Street's average estimate of 3 cents, according to IBES data from Refinitiv.
Overall revenue rose 3 percent, excluding the effect of fluctuating exchange rates, to $1.29 billion. Analysts had expected revenue of $1.32 billion, on average.
Adjusted EBITDA fell 21 percent, excluding the effect of exchange rates, to $302 million, due to the higher income tax expense from the company's continuing operations, offsetting higher earnings from its discontinued operations.
(Reporting by Matt Scuffham in Toronto; Editing by Bill Rigby)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)