Dow Jones today announced it has taken full ownership of online business news and information provider Factiva, which it had held in a 50/50 joint venture with Reuters since it launched in 1999.
Dow Jones will pay Reuters $160 million up front, made up of $153 million in cash plus $7 million in preferred stock. Most of that cash comes from Dow Jones’ planned sale of six local newspapers held under its Ottaway division. In addition, Dow Jones will make about $25 million in payments over the next 3.5 years under a variety of agreements.
Owning 100 percent of Factiva will accelerate the pursuit of Dow Jones’ mission to be the top multi-channel business information provider, according to CEO Rich Zannino.
“The acquisition will nearly double the size of our enterprise media group. Together with the previously announced sale of up to six of our community newspapers, this reflects our determination to reduce our reliance on print publishing and to deploy our capital to the highest-returning investments for our shareholders as opportunities arise,” Zannino said in a statement.
While Zannino characterizes Reuters as a “good partner,” having full control of Factiva allows Dow Jones to more closely integrate the service with others in its enterprise media group, like its newswires and licensing services. It will also be used to add value to the consumer media group, with plans to develop business search products targeting the consumer market.
Factiva fits into Dow Jones’ enterprise media group, which was formed in a February 2006 restructuring of its business based on its media properties and audience, instead of its previous channel-based approach. That group also contains Dow Jones’ newswires, licensing services, indexes, financial information services, and enterprise-facing joint venture Stoxx.
The flagship Wall Street Journal franchise, as well as Barron’s and MarketWatch, are housed in its consumer media group. The community media group is made up of the company’s daily and weekly Ottaway community newspapers.
The enterprise media group is headed by Clare Hart, who served as Factiva’s CEO from 2000 until her appointment as president of that group earlier this year.
Once the integration is complete, Dow Jones expects Factiva to contribute about $290 million in revenue and about $50 million in earnings
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