Canada’s richest family is turning to a long-time lieutenant who once worked as a news reporter to manage its vast empire.
The Thomson family has elevated David Binet to the top job at Woodbridge Co. Ltd., the private holding company that manages most of its $20-billion-plus fortune, including controlling stakes in Thomson Reuters Corp. and The Globe and Mail and a large equity position in BCE Inc.
Mr. Binet, who joined Woodbridge in 1999 and was a partner at Torys LLP before that, replaces Geoff Beattie, who stepped down after 15 years as Woodbridge president.
Mr. Beattie spent years as the public face of the very private family and was a key player in engineering Thomson Corp.’s 2008 merger with Reuters Group PLC that created one of the largest news and financial services companies in the world.
“Woodbridge has experienced a period of growth and diversification under Geoff’s tenure, including the acquisition of Reuters,” the Thomson family wrote in a statement to its employees.
`“Woodbridge is strong in financial terms and well-positioned to serve its family shareholders. Geoff has also been an ambassador for Woodbridge through his outside commitments in the business and not-for-profit sectors.”
The company didn’t provide any other details on his departure, other than to say Mr. Beattie would stay on as deputy chairman of Thomson Reuters. He is expected to spend the majority of his time on Thomson Reuters work, in addition to the other public company boards he serves on, including General Electric Co. and Royal Bank of Canada.
Tim Casey, a media analyst at Bank of Montreal’s investment division, said the departure may be a signal of growing frustration within the Thomson family over its Thomson Reuters investment, which has underperformed since the merger and has been losing ground to rival Bloomberg LP.
Thomson shares have fallen about 25 per cent since the deal was closed and now trade for about $27.
“We suspect this latest leadership change reflects growing impatience from the family regarding shareholder value,” he wrote in a note.
“That said, given the current macro environment, particularly in financial services, there does not seem to be obvious value creation initiatives from a corporate perspective.”
Thomson Reuters acknowledged the difficulties it was having last year when it took a $3-billion writedown on the deal and parted ways with several top executives, including chief executive officer Tom Glocer. Jim Smith, who took over for Mr. Glocer, said when he took over the CEO’s job that the company “did not execute up to our expectations.”
“External world and market valuations have changed since we completed the Reuters acquisition in 2008,” he said.
Some of the Thomson Reuters’ problems are external.
Banks and other financial services companies that pay to use its data terminals have been downsizing and the global economy has companies leery of spending money on new technology.
Still, the analysts who follow the company have shown little enthusiasm for its shares. Sixteen of them have “hold” ratings, while five have “buy.” Three advise selling.
Earlier this month, the company posted a 15-per-cent decline in operating profit for its third quarter on flat revenue.
Mr. Binet – who earlier in his career was a reporter for the Canadian Press wire service – was named to the Thomson Reuters board yesterday.
“The ongoing success of Thomson Reuters is critical to the success of Woodbridge,” the Thomson family stated.