June 7, 2011 / 9:03 PM / 7 years ago

UPDATE 1-ITG buys energy research provider for $38.5 mln

* Acquires Calgary-based Ross Smith Energy Group

* Expects deal to add 8-10 cents a share to earnings in 2012

* To rebrand Ross Smith as ITG investment research (Follows alerts)

June 7 (Reuters) - U.S. agency broker Investment Technology Group Inc said it acquired Ross Smith Energy Group Ltd, a Calgary-based provider of research on the oil and gas industry, for $38.5 million in cash.

ITG also entered into a $25.5 million, four-year term loan to help preserve its balance sheet flexibility following the acquisition, the company said in a statement.

Ross Smith, which has about 40 employees, provides technical and financial analysis of North American resource plays, public and private companies, as well as coverage of macroeconomic energy issues, for more than 200 clients in North America and Europe, ITG said.

Ross Smith’s revenue for the trailing 12 months ending April 2011 were about $15 million.

ITG said the transaction was not expected to add materially to earnings in 2011 due to one-time acquisition and integration charges. However, it expects the deal to add 8-10 cents a share to earnings in 2012.

Ross Smith will be rebranded as ITG Investment Research and the research offering will be an integrated part of the ITG platform, the company said. (Repoting by Anil D’Silva; Editing by Sriraj Kalluvila)

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