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Stratigic Financial Management
Pages 25 (6275 words)
In 2005, Reuters sold its holdings of INSTINET, an electronic trading platform for stocks, to Nasdaq. The sale was large-INSTINET sold for $1.9 billion. Was the investment and sale worth it Who had the most to lose and/or gain, Reuters or Nasdaq
To analyze the sale of INSTINET to Nasdaq, it is important to know deeply Reuters…
The main trends of the industry are the explosion in electronic trading; the service providers have their own technologies and systems; and the coming of the age of media personalization.
On the other hand, to analyze the company situation was considered the product and market strategy, its business unit situation and the financial performance. With respect to financial performance, Reuters had a gradual improvement in sales in 2005, but its profitability has been very volatile in the last few years, nevertheless in February 2006 experienced an amazing 25% increase in its 2005 profits.
The question here is if the sale of INSTINET has benefited not only Reuters but also Nasdaq According to financial data presented, both companies are in a much stronger and healthy financial position than before the sale of Instinet.
With nearly 200 news bureaus, Reuters ranks as the world's largest international news agency, publishing stories in almost 20 languages. Reuters has always been an innovative leader in delivering news.
In 1850 Reuters founder, Paul Julius Reuter, "created a company devoted to delivering information using the best available technology" ("History of Reuters' Technical developments," p. 1). In 1850, the best available technology was a fleet of 45 pigeons that would deliver news and stock prices between Brussels and Germany within two hours. ...
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