By CHARO LOGARTA
ABS-CBN News

Despite the ongoing global downturn in the financial markets, international information provider Thomson Reuters remains bullish on its prospects in Asia and the Philippines.

In a meeting with the local media, executives of the newly-formed company, a convergence between news service provider Reuters and financial information company Thomson Corp., said the Philippines is one of their high growth areas because of the increasing number of information-driven companies like call centers and other business process outsourcing firms in the country.

"I see growth continuing in major Asian markets. This is not an unrealistic outlook. We are wait-and-see on the global scene, but the Asian market is big and strong," Devin Wenig, Thomson Reuters CEO for its markets division, said.

Most financial markets all over the world are seeing a downturn led by an exodus from Wall Street and emerging markets. This has been accompanied by a spike in commodity prices, and in turn, global food prices.

The company officials, however, did not go into details regarding the new growth areas they will pursue as a merged entity beyond saying it will stick to providing intelligent information for the world's professionals.

Thomson Reuters also said that of the 60 percent market share it has cornered in the Philippines, bulk can be attributed to bank and treasury professionals seeking up-to-the-minute data on various financial markets.

Wenig admitted that company officials of both Thomson and Reuters did not factor in a global financial downturn when they planned the merger more than a year ago. However, he said prior knowledge would not have affected the decision to combine.

"The merger was in the works more than a year ago, and we didn't see a financial downturn then. But I don't think it would have mattered," he said.

Few layoffs in RP

As with all mergers, Wenig did not discount the possibility that employees from either side of the two companies will be laid off due to redundancies. However, he assured that casualties will be few in the Philippines.

"We've announced that we are going to save $500 million from streamlining from the merger, but we're not looking at a meaningful overlap," he said, explaining that they have yet to look into actual numbers of people who will be declared "redundant" due to the unification.

This may be due to the fact that most of Reuters employees in the Philippines serve a news function, while those who work for Thomson perform financial content development functions. The combined entity of Thomson Reuters employs over 1,100 people in the Philippines alone, and over 50,000 worldwide.

"There will be no meaningful cost reduction in our Philippine market," said Wenig.

Thomson Reuters has about 1,100 employees in Manila, which accounts for about 9% of its workforce in the Asian region.

Mr. Wenig added that though its Manila operations are relatively smaller, it is one of Thomson Reuters' fastest growing markets. The company plans to introduce more services to the Philippines, particularly information services for the medical, legal, accounting and healthcare professions.

Cost-savings

Globally, the Thomson Reuters merger is expected to generate more than $ 500 million in annual cost savings within three years.

"But not all of these would be from lay-offs," Mr. Wenig noted, "there will be some (lay-offs), but it won't be large. We will generate savings from things like office space, real estate."

The $17 billion Thomson Reuters merger was one of the biggest in the last year. But contrary to other recent mergers, the move is not one driven by cost-savings, but one that creates a bigger business. The merger would create a major rival to Bloomberg.

"But we are a much bigger business than Bloomberg," said Mr. Wenig, "We're competing only for the terminal information."

Reslient business

Mr. Wenig also expressed bullishness over Thomson Reuters' prospects, despite bearish economic and market condition, pointing out that their business remains resilient, especially in Asia.

Its business model, Mr. Wenig added, was also relatively immune to downturns in the traditional media industry because Thomson Reuters focuses on intelligent information for specialized professionals and corporates and operates much of this via the internet, which is where advertisers are putting more placements in for cost-effective exposure.

The Thomson Corporation and Reuters Group officially merged last April 17, creating one of the world's most formidable information sources, with operations in 93 countries covering 143 economies.

Thomson Corp. acquired Reuters for 352.5 pence in cash and 0.16 Thomson Reuters PLC shares for each Reuters ordinary share. Thomson Reuters listed on Nasdaq, New York, London and Toronto stock exchanges last April 17.

The company is expected to announce its first quarter, 2008 financial highlights on May 1, for the first time after the merger.

Thomson Reuters had a 2007 combined revenue of approximately $12.4 billion.