BEDFORD, MA, - Interactive Data Corporation (NYSE: IDC), a leading provider of essential financial data and analytics, today announced it signed an agreement to acquire S&P ComStock, a real-time information service that provides worldwide financial data, news, historical information and software applications. Interactive Data Corporation will pay $115 million in cash for S&P ComStock.
"The ComStock business is very complementary to Interactive Data's business," said Stuart Clark, president and chief executive officer. "We both serve the mission-critical operations of the global financial community through the electronic delivery of high value market data. ComStock specializes in the provision of real-time market datafeeds, which will fit well with Interactive Data's provision of end-of-day, snapshot and historical data services, covering more than 3.5 million securities.
"This acquisition is very exciting for our business and our future for many reasons. At the content level, it fills in a significant gap in our armory by giving us direct access to real-time market data from more than 180 stock exchanges and other sources worldwide. This will help us both strengthen our existing business areas and open up many new opportunities. For the past year, we have talked about our plans to build an institutionally oriented real-time datafeed business by gradually investing in the capabilities we have within our institutional and retail business segments. This acquisition, in a single step, makes us a leading supplier of real-time datafeed services, and gives us the opportunity to market ComStock's content and product to several thousand institutional customers worldwide, many of whom we know have a need for real-time data. At the same time, by combining ComStock's real-time content with Interactive Data's unmatched reservoir of end-of-day and historical data, we can create new and enhanced solutions for our customers."
Clark concluded, "This acquisition is very similar in nature to the acquisitions we have completed and integrated so successfully over the past several years. There are many potential revenue and operational synergies between the ComStock business and both the institutional and retail segments of Interactive Data Corporation. Through these synergies and the underlying performance of ComStock, we expect to generate a 20% - 25% EBITDA return on our investment within two to three years. This is consistent with the target return we have set for previous acquisitions. We also expect the acquisition to be at least earnings neutral for 2003, the first year of integration, and accretive to earnings thereafter."
Assuming that the transaction closes at the end of February 2003, the company expects the ComStock business to contribute in the range of $50 million - $55 million in revenues in 2003. The transaction is subject to customary closing conditions, including governmental approvals and the approval of The McGraw-Hill Companies' board of directors.
S&P ComStock is a unit of Standard & Poor's, which is a division of The McGraw-Hill Companies. S&P ComStock covers equity, fixed income, foreign exchange, commodities and money markets, providing information from more than 180 stock exchanges and other sources worldwide to on-line companies, brokerage firms and investment managers.
Forward-looking and Cautionary Statements
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and is subject to the safe-harbor created by such Act. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those contemplated in the forward-looking statements. Such factors include, but are not limited to: (i) the presence of competitors with greater financial resources than the Company's and their strategic response to the Company's services and products; (ii) changes in technology, which could affect the competitiveness of the Company's products and services; (iii) maintaining relationships with key suppliers and providers of market data; (iv) a decline in activity levels in the securities markets, which could lower demand for the Company's products and services; (v) consolidation of financial services, both within an industry and across industries, which could lower demand for the Company's products and services (vi) prolonged outage at one of the Company's data centers; (vii) the acceptance of the Internet as a reliable real-time distribution platform by institutional customers; (viii) the ability of the Company to broaden its subscriber base by adding more individual investors outside of the Company's traditional "active-trader" market; (ix) difficulties the Company may experience in integrating the ComStock business; (x) the potential obsolescence of the Company's services due to the introduction of new technologies; and (xi) other trends in competitive or economic conditions affecting the Company's financial condition or results of operations not presently contemplated. The Company undertakes no obligation to update these forward-looking statements.
About Interactive Data Corporation
Interactive Data Corporation is a leading global provider of securities pricing, financial information, and analytic tools to institutional and individual investors. The company supplies time-sensitive pricing (including evaluated pricing), dividend, corporate action, and descriptive information for more than approximately 3.5 million securities traded around the world, including hard-to-value instruments. The company links to most of the world's best-known financial service and software companies for trading, analysis, portfolio management, and valuation.
Interactive Data Corporation is headquartered in Bedford, Massachusetts. Through its branded businesses, FT Interactive Data, CMS BondEdge, and eSignal, Interactive Data Corporation has approximately 1,600 employees in 22 offices in North America, Europe, Asia, and Australia. Pearson plc (NYSE: PSO), an international media company, whose businesses include the Financial Times Group, Pearson Education, and the Penguin Group, owns approximately 60 percent of Interactive Data Corporation.
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