Citicorp Plans to Sell Quotron to Reuters, End Ill-Fated Acquisition

Citicorp announced Thursday that it has agreed to sell most of its disastrous Quotron market data business to Reuters America Holdings and take a $179-million writeoff as a result, a move that would effectively rid the banking giant of an ill-fated acquisition that it once hoped would put it on the cutting edge of the Information Age.

New York-based Citicorp also said it will set aside $425 million to pay for a restructuring aimed at improving productivity.

Ironically, Citicorp is selling Quotron, which provides Wall Street data to investment managers and securities brokers, at a time when most companies cannot seem to get enough of information-related ventures.

The acquisition of Los Angeles-based Quotron was once hailed as an innovative move by Citicorp Chairman John Reed, who championed the $680-million acquisition in a somewhat unfriendly deal in 1986.

At the time, the name Quotron was to stock-quote terminals what Kleenex is to tissues. Tens of thousands of the computer-like terminals sat on the desks of stockbrokers across the country.

But Quotron proved to be a sea of red ink for Citicorp as its once-dominant business was eaten away by aggressive competitors such as Automatic Data Processing, Reuters and Bloomberg Business News.

Quotron also suffered some embarrassing moments, such as the day in 1989 when it could not get the Dow Jones industrial average right while the market was fluctuating wildly.

Citicorp’s information business segment was plagued by losses for years, and layoffs became commonplace. In 1991, Citicorp shocked Wall Street when it took a $400-million charge in its third quarter as a result of Quotron’s problems.