The Canadian Press - ONLINE EDITION
Glocer to step down as CEO of Thomson Reuters amid struggles in markets division
TORONTO - Tom Glocer is stepping down as CEO of Thomson Reuters Corp.(TSX:TRI) after a decade-long run as boss of the embattled global data and news giant controlled by Canada's Thomson family.
The management shakeup, announced late Thursday, comes as the company faces a tough economy and weaker results in its financial markets operations, which provide specialized data to banks, brokers and other financial companies.
"We look forward to beginning the new year with a new management team, new organizational structure, and ever stronger commitment to deliver long-term, sustainable value for all shareholders," David Thomson, chairman of the company's board, said in a statement late Thursday.
Glocer, 52, will exit his role at the end of the month, and will be replaced by James Smith, the company's chief operating officer who was appointed to that post in September. The move anointed him as Glocer's heir apparent.
"By the end of this year, the organizational, strategy and budget work I have been leading will be complete, and the transition plan I launched last summer will have achieved its objectives," Glocer said in the statement.
Glocer told Reuters news service at the time of Smith's last promotion that he intended to "stay for a good long time to fix and thrive under this business."
Weak performance in the markets division led to the departure of other senior executives earlier this fall, when it was merged with the company's professionals division. The company has been affected by troubles on Wall Street and the financial sector, which has squeezed the budgets of its traditional customer base.
Glocer had taken on personal responsibility for a turnaround in the markets division, said one analyst who did not want to be named.
"I'm not completely surprised (about his departure) given recent management developments and the issues in the markets group that led up to those management changes," he said.
Shares in the company have lost nearly one-third of their value in the past year, closing at $27.22 Thursday on the Toronto Stock Exchange.
Glocer, who is also retiring as a director of the company's board, has been CEO at the company since 2001.
"Jim Smith is a very talented executive with whom I have worked closely over the past four years; he is ready to lead Thomson Reuters," Glocer said.
Glocer was the first American to lead Reuters Group when he became CEO in 2001. He became CEO of Thomson Reuters in 2008 when Canada's Thomson family bought Reuters.
The Thomson family — which owns about a 55 per cent stake in the company through the Woodbridge Co. — appears to be exerting more control. Glocer was the last link to the old Reuters management team in the merged company.
Smith, who takes the reins in the new year, has served in numerous positions in Thomson companies since he joined its newspaper group in 1987.
Starting his career as a journalist, Smith has served as chief executive of the Thomson Reuters professional division.
Before that, he was chief operating officer of The Thomson Corp. and also president and chief executive of Thomson Learning's Academic and Reference group.
Thomson Reuters has offices in Toronto, New York, and London, employing 55,000 people.
The worldwide business information and news giant provides information to media as well as financial, legal, accounting and science sectors. It also polls industry analyst expectations ahead of company earnings reports.
David Thomson, Canada's richest person with a net worth of more than $20 billion, said Glocer will be remembered as the man who turned around Reuters a decade ago, led it to growth and guided its sale.
"Over the past four years, Tom successfully directed an extensive integration, expanded our business internationally, revitalized the Reuters news organization and championed talent across the entire business," said Thomson.
"Working with Tom Glocer, the board oversaw the successful execution of an established succession plan in the second half of 2011."
The Toronto businessman's grandfather, Roy, started the former Thomson Corp. in the 1930s as an operator of small newspapers and radio businesses. That company eventually grew into Canada's largest newspaper publisher, but later sold the business to focus on North Sea oil investments and retail.
In the 1980s Thomson Corp. began to diversify into specialized data for lawyers, accountants, brokers and other professionals — a business that is the bedrock of its operations today.
In July, Thomson Reuters announced it is streamlining its markets division, which includes the Reuters news service and trading terminals, after it performed below expectations. The company is combining its sales and trading unit with its investment and advisory business, among other changes.
"We expect the benefit of these changes will improve sales performance in 2012 and benefit 2013 revenue growth,'' Glocer said in a statement last month.
In Thursday's announcement, the company also reaffirmed its full year outlook for 2011, excluding any one-time charges related to the restructuring.
In the third quarter, the company said it earned US$381 million or 44 cents a share in the three months ended Sept. 30. That was up from net earnings of US$277 million or 32 cents a share a year earlier.
Note to readers: This is a corrected story. A previous version said David Thomson's net worth was more than $20 million instead of $20 billion.
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