WEFA (formerly Wharton Economic Forecasting Associates) and Data Resources (DRI) have been the pre-eminent companies in the field of crunching economic data and forecasting. Each company works to understand and quantify how the economic environment impacts organizations and governments. Now, the two competitors have been purchased from their parent companies and a new company has been formed to integrate and grow the businesses.
Global Insight, Inc. (GII), a privately held corporation headed by Joseph Kasputys, has been formed through the acquisition of 100 percent of four businesses and a significant interest in a fifth. In addition to DRI and WEFA, the company has purchased Primark Decision Economics, a provider of economic advice to financial and business leaders, headed by economist Allen Sinai, who continues to hold an equity interest in this company; DAFSA, a European market research company; and Primark Poland, a software development company with expertise in time series data management.
DRI was acquired from The McGraw-Hill Companies, Inc. The interests in the other businesses were acquired from The Thomson Corp., which had obtained them through its purchase of Primark in September 2000. The purchase prices were not disclosed.
Kasputys has been closely tied to all of these companies. He was president of DRI from 1977 to 1983 and was executive vice president of its parent company, McGraw-Hill, until 1987. After joining the publicly traded Primark Corp. as CEO, Kasputys acquired WEFA in 1997. In 1996, he co-founded Primark Decision Economics with Sinai, and he also began Primark Poland. After Thomson acquired Primark, he served as chairman of Thomson Financial, but stepped down January 1, 2001. It seems fitting that Kasputys is uniting them under a single corporate umbrella that could offer the scope and scale to expand the businesses and build upon synergies.
"GII was formed to create a comprehensive line of top-quality products and capabilities that provide our clients with the insights needed for better decisions," said Kasputys, who will serve as Global Insight's chairman, president, and CEO. "Our mission is to be the leading organization that provides business executives, investors, and government officials around the world with economic information, analysis, and solutions," he added.
In these days of re-examining corporate focus and strategies, both McGraw-Hill and Thomson indicated in their respective press releases that the companies they were selling no longer fit into their organizational goals. Thomson, in particular, has been very active in acquiring and divesting companies as its business plans evolved.
"The sale of WEFA is right in line with Thomson Financial's strategy to foster those business units that are particularly relevant to our customer base and corporate strategy and that effectively build upon our total work flow solution offerings. WEFA did not fall within this category," said Patrick J. Tierney, president and CEO of Thomson Financial. He also indicated that the sale of WEFA was in line with a series of other divestitures, "all of which are being done to focus our resources on our core investment banking, brokerage, institutional money management, and corporate customers."
DRI was part of The McGraw-Hill Companies' Standard & Poor's business unit. Leo C. O'Neill, president of Standard & Poor's, said, "The divestiture of DRI is consistent with our strategy of directing resources to businesses where we have the greatest opportunities for significant financial growth and market leadership."
GII's first step with these acquisitions has been to integrate DRI and WEFA. Their newly merged Web site is available at http://www.dri-wefa.com, with links to the existing home pages. According to a Client Q&A on the site, the company plans to keep the many complementary capabilities of DRI and WEFA intact, but combine similar services to produce a superior product in each area of overlap. DRI-WEFA intends to add more data and offer consulting and strategic advisory services for key industries. As a first priority, the company plans to establish a single, official economic forecast that will be implemented in all models and publications as soon as possible, though all legacy forecast information will be available for client reference.
According to GII, the new company has over 3,000 clients in industry, finance, and government around the world, with $70 million in revenues, over 500 employees, and 30 offices.