Exco Will Sell 52% Stake in Telerate : Dow Jones, Oklahoma Publishing Co. Offer $460 Million

Exco International is selling its 52% interest in Telerate Inc., a financial information company, for $20 a share, or about $460 million, to Dow Jones & Co. and Oklahoma Publishing Co., it was announced Monday.

Under the agreement, Dow Jones will acquire about 14.1 million shares, or 32%, of Telerate for $282 million.

Oklahoma Publishing will buy 20% of Telerate, or nearly 8.9 million shares, for $178 million.

Dow Jones and Oklahoma Publishing said they expect the transaction to close in about six weeks following approval by Exco shareholders.

Founded in 1969, Telerate supplies financial quotes and prices to 24,000 video display screens in 41 countries. With its main strength in the United States, it earned $28.7 million on revenue of $114 million in the fiscal year ended last Sept. 30. For the six months ended March 31, Telerate had net income of $16.8 million on revenue of $71.1 million.

In the financial information market, Telerate is a rival to Reuters, an international news organization that supplies economic data to 53,000 video screens and teleprinters in 98 countries.

Exco International is a financial-services company based in London. It first acquired an interest in Telerate in January, 1982, and raised its stake to more than 50% in September, 1983, Exco said in a statement.

Exco said it will use the proceeds from the sale to develop further its range of institutional financial services and to fund acquisitions.

Dow Jones and Oklahoma Publishing said in a joint statement that they don’t plan to extend their purchase offer to other Telerate shareholders.

Remain Publicly Traded

“We believe it is in the best interests of Telerate, its employees and other shareholders for the company to remain publicly traded,” the companies said.

On the New York Stock Exchange, Telerate closed Monday at $18.625 a share, unchanged from Friday’s close.

Dow Jones publishes the Wall Street Journal, community newspapers, magazines and textbooks and operates business and financial news services and a computerized information retrieval service.

Oklahoma Publishing is a closely held company based in Oklahoma City, where it publishes the Daily Oklahoman. It also publishes the Colorado Springs, Colo., Sun and owns, through its Gaylord Broadcasting unit, television stations in Houston, Seattle, Dallas-Fort Worth, Cleveland, Milwaukee, New Orleans and Tampa, Fla., and radio stations in Oklahoma City and Nashville, Tenn.

It has interests in television programming and owns Opryland USA, a theme park, in Nashville.

Outside North America, Telerate’s services are marketed by a company that is 50.4% owned by Telerate.

The remainder of that company is owned by Associated Press and Dow Jones, which jointly operate AP-Dow Jones, an international business and financial news service.

“It’s just a question of Exco seeing a good price and taking it,” commented one analyst, who said the price was about 22 1/2 times Telerate’s estimated earnings for the 1985 calendar year.

Dow Jones must be confident of good growth in the sector to have paid the announced price, he added.

One analyst noted that Telerate was embarking on an extensive program of capital spending and suggested that Exco Chief Executive John Gunn was anxious not to pick up the tab.