Union Alliance Urges Scrutiny of Thomson-Reuters Deal

WASHINGTON, May 14 /PRNewswire/ --

A transatlantic alliance of unions representing employees at Reuters Group Plc (Nasdaq: RTRSY) (London: RTR) on Monday urged a powerful trust to closely scrutinize the company's proposed merger with Thomson Corp. (NYSE: TOC; Toronto) to ensure that it does not compromise Reuters' independence and journalistic integrity.

In letters to the directors of the Reuters Founders Share Company Ltd., which is entrusted with protecting the company's "Trust Principles" and empowered to block a merger, leaders of the unions cited several concerns about the merger that the two companies disclosed they were discussing on May 8. [Letter follows this release.]

"There are deep concerns, despite assurances we have already heard, over whether a reconstituted Reuters would maintain the high standards of journalism and the integrity, independence and freedom from bias that have shaped the company's 156-year-old reputation and are crucial to its future success," the letter said.

Among the union leaders' concerns was a merger proposal to allow a Thomson family holding company to own a 53 percent stake of the newly merged company, even though Reuters limits shareholder stakes to 15 percent and a "Trust Principle" bars Reuters from being controlled by "any one interest, group or faction." The Thomson family now controls Thomson, a Canadian electronic information firm based in Stamford, Conn.

The unions -- The Newspaper Guild-Communications Workers of America, its New York and Canadian locals, the National Union of Journalists and Amicus-GPM -- represent journalists, technical workers and many other employees of the London-based news and information company in the United States, the United Kingdom and Canada.

The Reuters Founders Share Company, chaired by Swedish industrialist Pehr Gyllenhammar, was established when Reuters became a publicly owned company in 1984 to protect the "Trust Principles" with its omnipotent "Founders Share" that can outvote all other shareholders and stop a takeover. The "Trust Principles," which date back to 1941, were created largely to maintain Reuters as a reputable, thriving, bias-free, independent global news organization.

The companies announced on May 8 that they were in talks for Thomson to buy Reuters. The merged company would be called Thomson-Reuters, but it would be run by Reuters CEO Tom Glocer and its news and information division would be called Reuters. The deal cannot be completed without the approval of the Reuters Founders Share Co.

May 14, 2007 Mr Pehr Gyllenhammar, Chairman The Reuters Founders Share Company Limited The Reuters Building South Colonnade Canary Wharf London E14 5EP United Kingdom

Dear Mr Gyllenhammar:

The news that Reuters is discussing a change of ownership for the first time since the Reuters Founders Share Company was established has left employees unsettled and concerned over their suddenly uncertain futures.

As representatives of the journalists and many other employees whose work and dedication give Reuters its unique value, we are writing to relay these concerns to you as the guardian of the Reuters Trust Principles who will review the proposed merger.

There are deep concerns, despite assurances we have already heard, over whether a reconstituted Reuters would maintain the high standards of journalism and the integrity, independence and freedom from bias that have shaped the company's 156-year-old reputation and are crucial to its future success.

In particular we have the following questions about the Trust Principles:

1) Reuters constitution requires that no person may hold 15 percent or more of Reuters shares. How then can the Thomson family hold a 53 percent stake?

2) The first Trust principle says "that Reuters shall at no time pass into the hands of any one interest, group or faction." The use of the words "at no time" suggests this principle is inviolable and cannot be waived under any circumstances. If it is now to be breached for the Thomson family, why should anyone in the future pay attention to the remaining Trust Principles?

3) If this takeover were to go ahead, what guarantees are there that the Thomson family would not in turn sell its 53 percent stake in Reuters to another group at a future date? We note that Thomson sold The Times and the Sunday Times to Rupert Murdoch.

As employee representatives, we are bound to protect the rights and promote the interests of our members throughout this process. As you scrutinize this unprecedented merger for its verifiable commitment to preserving the Trust Principles and the Founders Share Company as their protector, we ask that you also remember the employees.

From the largest business centres to the most far-flung bureaus, the journalists at Reuters who bring the world printed news, pictures, video images and Web content, and the many other employees whose work supports them, try to live up to the Trust Principles every day. Now, they are counting on you to keep the Trust Principles safe.

Sincerely, Myra MacDonald, Joint Mother of the Chapel, Reuters National Union of Journalists Anthony Austin, Joint Father of the Chapel, Reuters National Union of Journalists Jeremy Dear, General Secretary National Union of Journalists Linda Foley, President The Newspaper Guild-CWA Alan Burn, Senior Representative Unite in Reuters (Amicus-GPM) Peter Szekely, Reuters Unit Chair The Newspaper Guild of New York Bill O'Meara, President-elect The Newspaper Guild of New York Kathy Viner, Staff Representative The Canadian Media Guild cc: Reuters Founders Share Company Directors

Web site: http://www.cwa-union.org