Reuters rockets - and float due

By LUCY FARNDON
Updated:

 

Reuters shares powered ahead after the information group produced impressive third-quarter sales and confirmed plans to float its Instinet electronic broking arm. The group beat market expectations with a 16% growth in revenues to £888m for the three months to September. Excluding acquisitions, disposals and currency movements, underlying sales rose 11%.

Instinet was particularly strong, with sales up 46% to £189m, helped by high trading volumes on Nasdaq.

Chief executive Peter Job says the core Reuters Financial business 'is thriving in good market conditions'. The shares rose 73p to 1311p, a two-day gain of 190p.

'Instinet is driving the growth. The recent share rally has been warranted,' says Andrew Gordon-Brown at JP Morgan.

Reuters is expected to float 20% to 25% of Instinet, which has a total value of £2.5bn to £4bn. Job would not be specific on the timing of a float, but analysts expect it within the first half of 2001. 'I don't want to be hostage to fortune because market conditions can be anything,' Job says.

Reuters also expects to float its Greenhouse Internet investment fund, but the timing depends on the market.

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