Xinhua News Agency

Xinhua Finance to focus on Greater China after bureau sales

PUBLISHED : Saturday, 02 June, 2007, 12:00am
UPDATED : Saturday, 02 June, 2007, 12:00am

Xinhua Finance, a Tokyo-listed mainland business news wire service provider, will focus on covering the Greater China market after selling its seven Asia-Pacific news bureaus to Canadian-based peer Thomson Financial, according to an announcement on Thursday.

The agreement, which took effect yesterday, covers the bureaus in Tokyo, Manila, Jakarta, Kuala Lumpur, Singapore, Sydney and Seoul.

The two companies have also signed licensing agreements on the exchange of news services after the sale.

The deal would enable Thomson Financial to further enhance news coverage in the region, Xinhua Finance said.

Xinhua Finance will continue to maintain editorial operations in Beijing, Shanghai, Hong Kong and Taipei.

Both companies declined to disclose the financial terms of the deal.

'This allows us to cut costs from our non-core area and refocus our efforts and resources on our core geographic competency, which is Greater China, while at the same time enhancing our strategy of bridging the mainland's financial markets with the world's,' Xinhua Finance chief operating officer Daniel Connell said.

'We believe this will benefit the two companies, our customers and our employees.'

Shanghai-based Xinhua Finance provides financial institutions, corporations and re-distributors with services on indices, ratings, financial news, investor relations and distribution.

The deal did not affect other Xinhua Finance news units, including Market News International, Stone and McCarthy and G7 Group, the company said.

Xinhua Finance's first-quarter earnings before interest, tax, depreciation and amortisation (ebitda) fell 47 per cent to US$3 million from a year earlier. Revenue rose 25 per cent to US$46.6 million.

The company booked a net gain of US$105.8 million from the spin-off of subsidiary Xinhua Finance Media in the United States in March.

The company forecast ebitda would jump 33 per cent this year to US$60.5 million from a year earlier on an 11 per cent increase in revenue to US$260 million.

Thomson Financial, the owner of the Westlaw legal database and the TradeWeb bond-trading network, last month agreed to pay GBP8.7 billion (HK$134.41 billion) to acquire rival Reuters and create the world's biggest financial news and information company.