Blackstone in 'advanced talks' to buy $17bn stake in Thomson Reuters unit

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Thomson Reuters Corp. says it is in advanced talks with private equity firm Blackstone regarding a potential partnership in its financial and risk business.

Reuters did not disclose the size of the stake in the unit that it might sell to Blackstone but said it would retain a significant holding.

The financial and risk unit, which provides market data, analytics and trading terminals to banks worldwide, generates more than half of Thomson Reuters annual turnover, reporting $6.1 billion in revenues in 2016.

"As part of any proposed partnership, Thomson Reuters would retain a significant interest in the F&R business and would retain full ownership of its legal, tax & accounting and Reuter News businesses", Thomson Reuters said.

Once Thomson Reuters' board agreed to the deal, it would mean the biggest overhaul of Thomson Reuters since it was built ten years ago by Thomson Corp.'s buyout of Reuters Group Plc.

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Under the potential deal, Thomson Reuters would still control 45 percent of the F&R business. Other details regarding the arrangement were undetermined.

However, it cautioned that discussions between the two firms may not lead to a deal being struck. It bought Ipreo, which sells specialist software for tracking capital markets' activities in 2014 for just under US$1 billion.

Thomson Reuters now trades in NY and Toronto with a market value of around $31bn. The whole F&R business is valued at about $20 billion, consisting of about $7 billion in equity and $13 billion in debt, they said.

Shares of Thomson Reuters have fallen 9 per cent over the past 12 months compared to a 3 per cent rise in the Toronto Stock Exchange's main index in the same period.