Good morning, everybody. Thank you for joining us on day three of our Global Financial Services Conference. Unfortunately, we're virtual again. Hopefully next year we will be able to do it. Third time might be a charm in person. My name is Manav Patnaik. I'm Barclays' Business and Information Services analyst, and I'm very pleased to have with us today, Jerre Stead, who's the CEO, and Richard Hanks, who's the CFO of Clarivate Analytics. Thank you both for being here. It's great to be with you, Manav. Thank you. Thank you. Just for the audience, I will be doing a fireside chat with Jerre and Richard. If you have any questions, you should see a Q&A box on your screen. Feel free to send them in through there. If I catch them, I'll bring it up. Otherwise, I'm happy to follow up with you after the chat. With that out of the way, Jerre, maybe just to start off with, you just did a share offering and, just curious on what led to that ahead of a potential deal closure, which is ProQuest. Maybe somewhat tied to it, you also had a buyback program announced, so perhaps just some update there. No, actually, thanks for asking, Manav. Goes actually all the way back to a year ago in February, when I had started negotiations, in February 2020, had started discussions with ProQuest. Keep that in mind for a minute. When we were in the process of acquiring what's now CPA Global. If you remember, we closed in July of last year. That then becomes into part of our organic growth in October 1 of this year. Sorry, the negotiations, let me be square, that I started was in February of 2021, with ProQuest, Andy Snyder. We had reached agreement, that in 2020, when I was negotiating to acquire CPA Global, which was a wonderful acquisition, one we're very pleased with both Onex Baring Private Equity Asia, who's been a great investor. They were the original investor that had carved out Clarivate and started the carve-out in 2016. We did a reverse merger with them in May of 2019, and that's when I took over. I'll come back on that in a minute. We had agreed with Leonard Green and also Onex Baring that we would do our best, before the one-year lockup ended with Leonard Green, which is October 1st, to do as much downsize selling as we could of Onex Baring shares. What happened then was, we expected to do that last spring. That's when we were negotiating the deal with Andy for ProQuest. That stopped us from managing through that period of time because of course, that was inside knowledge. What happened then was my commitment was to take them down from a little over 100 million shares they had left, down to under 60 million. I agreed and had that also agreed with Leonard Green. We did two things. We did the 10 million share tack on, if you will, with the primary offering we did in June. With time running out, we did the 25 million shares last week, which gets them down under 59,500,000. That's what created the time issue. Going forward, with me managing any future secondaries as we move forward, it will be a balanced one. We'll look at Leonard Green. We'll talk to both them, who's been very cooperative, as has Onex Baring. Any decisions we make, that'll be made with both of them, or shared. Critical, and I inadvertently created the issue, because we didn't expect that we'd do the ProQuest deal. As you remember when we announced it, Manav, pretty straightforward. They were planning to go public. I got wind of that and had the opportunity to get them in. We had hoped to acquire them 2022. That's what put all of the stress on this, and we did that. I think having that all behind us, the other issue is we would love to have bought back those shares ourselves. As you know, we have a $250 million share buyback. Because of a situation that we will get corrected, have corrected going forward, that we're a Jersey-based corporation, we were not allowed to do that share buyback. That's the way we would have handled this. That gets us current. Going forward, I'll manage to the very best of my ability. I've done a lot of this over the years, that it's at the right time, right place, right price. Good to hear on the appetite for share buybacks there. On the ProQuest deal, I know anything with the FTC sensitive topic, to the extent you can, at the time of the acquisition, it didn't sound like there was a lot of overlap. Is there something to be worried about the second review, or is it just a change in administration? No, it's a great question. I announced when we announced the deal, there was $3.5 million actual overlap. That is the only overlap. I would say that with the second request, it is the result of change of management, we're on point. We're always going to do whatever the Federal Trade Commission asks. I'm very pleased with our progress. We're working through that. As I said when we announced the second request, we expect to close by year-end and feel really good about the progress. I'm very thankful for our team and everything that they've done, as I am for the ProQuest team. They've done a great job. We did do one thing that was important, Manav, because when we had announced the second request, we had expected to close mid-July latest. As we were all talking earlier, the whole world is full of labor shortage, if you will, and lots of turnover, high demand. We were able to work through, just did a great job with the ProQuest management. We provided $20 million to lock up critical members of their organization through December 31st, 2022. Because we've got 3,000 people there that want to come join our 9,000 people. Once we get approval, we'll do that. I feel really excited. The one upside benefit of the taking longer is we continue to learn more and more about what we'll do together. Great question, thanks. Got it. Richard, maybe just on the ProQuest deal itself, can you just remind us of kind of the guidance you had given on accretion and some of the numbers just around ProQuest, assuming they haven't changed? Yeah, sure. Just in terms of broad strokes, it's a $900 million plus business, 30% margins. We committed to save $100 million on a run rate basis over 18 months. Given the timing that Jerre Stead's just described, we will be working very hard to get the bulk of that executed within the first 12 months. In terms of accretion, we're looking at double-digit accretion within the first 12 months, and then into the teens after 18 months, which are the guardrails that we always have on any material transaction. Got it. Manav, if I could, I'd just add, just as a reminder to everybody, we were at the end of 2019, the first half year we were public, we were about an $800 million business, if you take out what we sold. We'll exit 2022 as a $3 billion business. I make that comment, one, because I'm very proud of what we've accomplished, but I feel better today than any place else I've been before with the organization we've got in place. Thanks. Got it. Jerre, maybe just on ProQuest. It obviously adds a lot of scale to your academic and government vertical, the way you've described it. Just talk about the merits of. You talked a little bit about potential revenue synergies, is it just scale? What are the revenue synergies there? Well, two things. Great question. We never include revenue synergies in our valuation or in our adjusted EPS. That's all upside for us as we go forward. In fact, you've been with me a long time. You know how many acquisitions. I've done 230 over my career. This one is the best matchup of side by side, with the exception of $3.5 million overlap side by side [billion to] very complementary. Some of the ProQuest software is as good as I've ever seen. It's in a market as we're shifting, Manav, to the One Clarivate. Just a reminder, when I first got involved in May of 2019, we had seven businesses, seven CEOs. By September of 2019, we merged those into two groups, science group and IP group, then made the acquisitions with DRG that complement the science group and the IP group with CPA, all of which we're very pleased with. What this does then is we move to One Clarivate that we've announced. We'll go into 2022 in four major markets. The second largest market is academic and government. It's a $26.5 billion market. By the way, we'll report on each of those markets so people can see how we're doing quarter by quarter. We'll be $1 billion, $2 billion, 3%, 5% of that market. The upside's significant. There's many places where they have software sold 2,000. We have over 7,000 of the universities around the world of which they've sold software and product into 2,000. Great cross-selling opportunity. We'll be bundling not just their products and ours, but also the life science products for the research universities. We look forward to selling to a lot of the universities the CPA product for managing their assets, intellectual property patents. That'll play out very well. Couldn't feel better. What it does. This is significant cost reduction in total for most of our customers as we go forward in that market. Really excited about it. More to come. Just a quick reminder, on November 9th, we'll do the Investor Day. We'll give guidance for 2022. I'm assuming that would not include ProQuest, so you'll see exactly what we expect to do in 2022, get a good view of that. The day we close, we'll give guidance for the merged businesses, so you'll know exactly what we're expecting. We'll talk in more detail at that time about the opportunities we've got with revenue synergies. Got it. All right. That's super helpful. Jerre, one of the questions, you pointed out that pre-COVID you were $800 million, now today, despite all the craziness in the world, you're at $3 billion almost as you may close the ProQuest deal. You're moving at warp speed, basically. Do you have the capacity in the organization to handle all this so fast, and quite frankly, so a lot of big acquisitions here? Great question. We've rebuilt the entire company and been blessed Manav to get the kind of talent. If you remember, I always look for, how do I get a team in place that can double and triple the business? In this case, in three years, we'll have almost quadrupled the business, and then well up in the future. We've been blessed to put together the best integration team I've ever been part of. Some of the folks that were at IHS that now are working for us, along with a great group of people that some were in CPA, some in DRG, and some in the mothership, if you will, Clarivate. Yeah. Just a couple of comments. We increased at the end of Q2 from $75 million to $100 million of cost takeout that we're getting out of CPA. We over-recovered what we said we'd do with DRG. As Richard said, we committed to $100 million out of ProQuest. We're on track, in fact, ahead of track in all the businesses. When we exit 2022, we'll have taken over $300 million of actual cost out. We're much more efficient today, and we'll operate in a much better way. Two other quick comments in that. We've done a lot of change internally. If you remember way back when we first started talking, we said 60% of our research and development people were contractors, and we said we're going to move that down to 10%. That's done. An amazing shift as I expected and Richard did. We're about 30% more efficient in time than we were before of new products. That's why the new products keep flowing, and we'll do a really good job of explaining those at Investor Day. We're also much more efficient, which is amazing if you think about doing all of this during COVID. Many of our people have never met each other, but we've created a great team. I feel really good about that. I commented yesterday, it's hard for me to believe, but three of our team that are on the leadership team, the top 13 that I support, none of the rest of my team, except me, has ever met, which is kind of hard to believe. We actually have one, Gordon, who's an incredible leader, great executive out of CPA, just an outstanding executive now running IP, I've never met personally. It's kind of hard to believe that we're accomplishing all of that. I feel great about it. We track it. In fact, yesterday we had our biweekly update on integration, and it's bang, bang, bang. Just couldn't be happier. Great team. Feel really good about that. We haven't talked much about it, but that includes the five smaller tuck-in acquisitions, and we've wrapped those all up too. Thanks. Got it. Richard, I was hoping you could just help us. You talked about before you had seven silos, you brought it to two product groups. I was hoping, I think you described four or five different verticals that go after this $100 billion TAM. I was just hoping you could just help remind the audience what those five verticals are and what mix perhaps they are of Clarivate. Absolutely. The One Clarivate structure is the customer-led design that Jerre and Steen Lomholt-Thomsen, who's our new Chief Revenue Officer, essentially introduced and led at IHS Markit. We will have four customer segments initially. academic and government, life sciences and healthcare, professional services, and the fourth is a combination of manufacturing, consumer products, and tech. When we get scale in that fourth leg through organic growth and also M&A, we'll strip that out into two. That goes from four to five. In terms of scale, as Jerre referenced earlier, the TAM is enormous, $100 billion plus. Pro forma of the ProQuest will be around $3 billion exiting next year. Academic and government will be our largest segment. It will be a circa $1.3 billion segment, including ProQuest. Very good growth trajectory. To your earlier remark about growth in academic and government and the synergies with ProQuest, personally speaking, I am really excited about the software part of the business. They sell currently to 2,000 institutions. The software tools, we sell to 6,000 to 7,000, our suite of offerings around Web of Science. There's a significant runway for growth there, number one. Number two, I think geographically as a vector for growth, we have real scale in Asia Pacific and ProQuest have less presence than we do. We've got some terrific customer relationships in the big markets, China, Japan, South Korea, Australia. That will be a significant focus for us as we integrate ProQuest and really drive growth and exceed our objectives. That's academic and government, very nice underlying trajectory. The products in that segment have the highest renewal rates. Number two is life sciences and healthcare. It is fair to say that in terms of the end market growth, this would be probably our fastest growing potential. The overall life sciences market for data and analytics is growing 12%-14%. Anchored in that execution is of course the DRG business that we acquired in February last year, which is growing very nicely in 2021. In terms of drivers of growth, nice organic growth opportunities there for us. I think that in terms of M&A, that would be an important area of focus for us as we think about capital allocation. Got it. Number three is professional services, great growth trajectory there, and then of course, manufacturing and consumer products. That's the overall design. Understood. Jerre, just to follow up there, I mean, clearly life sciences is a fast-growing market, so sounds like there's a lot more M&A coming there. When you think about professional and the other, I guess, other category, it sounds a little bit like what you did at IHS. You had these different verticals you entered into and built up. Every deal you've done has been bigger than the past one, and so just help us understand, what do we expect going forward? Are there a lot more big deals to be done? It's a great question. Again, once we get the approval, if you will, with ProQuest, we'll lay that out in pretty good detail, for sure, Manav. Think about the priorities of life science for sure. Yes, there are. When we talk about professional services, that market includes all the law offices and all the other professional service companies in the world. That one has, I would say, more tuck-in capability with us, including geographically, for sure. I feel really good about where we'll be on the academic and government, which by the way, is growing at 7% globally, worldwide. We'll report those each quarter too. We'll see how this all plays out. We're always thinking through how to make sure that we increase what our customers expect us to do, and that life science, as Richard said, would be a high priority. Professional services as we've defined it, I would see us filling in a very strong plate of opportunities there. Then as you said, the last, the fourth one, actually, we do more than most people know there, and we'll lay that out. With CPA, for example, we manage patents for Apple, we manage all the patents for Microsoft, et cetera. That's one that, again, we'll tuck in as we move forward. It's a great question. I feel really good about where we're at now. To be at $3 billion, actually two years ahead of what I said we would be, that feels great, and we'll make sure that all works. Our job is to make sure that a huge part of the scale is because of the beauty of the business. We'll be delivering over $1 billion of free cash flow, and we'll use that very efficiently to reduce the number of outstanding shares, and also reduce the debt to equity ratio if you will. Make sure that we balance that, Manav, for our share owners and our customers with new products going forward. Got it. I just want to touch on some of the organic growth, and specifically, your exit rate that you've talked about, the 6%-8%, exiting the fourth quarter of this year. Can you just help us walk through your confidence behind that? Also, clearly the comps were easier. Is that 6%-8% sustainable? Great question. Let's work backwards. Yes. The 6%- 8% is sustainable and will be for years to come. A high degree of confidence of exiting, as we said we would, 6%- 8%. We actually did 6% organic in the first half. It was an interesting first half because we had the COVID effect in second quarter of 2020, where that normally would've been in first quarter. That's why we said, please look at us in total. In fairness too, it was 4% annual subscription base, and so you'll see that growing as we exit 2021 into 2022 into a higher number. Price realization will end about just over 3% for 2021. We've built in over 4%, and we'll get that because we now have, for the first time, where we can show the value to our customers. We know by product, by customer, the usage on an hourly basis. Huge shift there. Feel very good. It's been interesting to me. We announced what we were going to do with inside sales. That's all in place. I think some people think it may be quicker than you're able to do. We did it pretty quick. We'll now have 23% of our revenue as we go into 2022 on inside sales. That'll significantly increase price realization. Equally, if not more important, is the retention rates will go up. Our target is to exit 2023 at 95%. Just a reminder on that, which is we measure it, as you know, no price increase is included, and if I did a deal with you last year at $100 and we start at $99 in 2022, that's a miss. That's important to know, and that's a critical part. Now the bundled products that we'll be able to offer, just the examples we gave you in academic and government, are really exciting because this is the first year in the history of these businesses that we've had commissions in place for cross-selling. Now as we move to the new One Clarivate that we laid out September 2019, we'll see that increase year after year. It's very sustainable. Last piece, I'm very proud of what's been done in our professional service business, which is to take and complement. Our target is for every dollar of revenue we get out of professional services, we'll get $20 of pull-through for our annual subscription base within two years. I'm very proud. That business is growing rapidly, 2.5 years ago, it didn't exist. That's the other piece that we'll see picking up for your question, how sustainable is the 6%-8%? Very sustainable. Got it. Richard, we'll wait for Investor Day for the actual guidance. Just looking at the different pieces of your business, the reoccurring piece, the patent piece, that's pretty steady, I think, in the 5%-7% range. Can you just help maybe understand. Subscription, is that accelerating? Also on the transaction side, how much of a catch up or recovery or rebound is that we had? As you said, reoccurring, which is our patent and annuities business, very steady. Price yield and volume 5%-7%, good number. In terms of subscription growth, absolutely. This is a very high priority for us. As Jerre mentioned earlier, we have a high degree of conviction of realizing 4% on a run rate basis plus in 2022. We need to deliver that. As a reminder, 50% of the book renews in Q1 and 20% of the book renews in Q2, so we'll have the majority of that behind us in the first half of next year. Number two is driving installations between now and the end of this year, so we've got a good anchor in our entry rate going into 2022. That's a very high priority. We're monitoring our data sets currently as we close out 2021 and drive the ACV book of business position into 2022. New installations and new products. We've done a lot on new product development in the last two years. Our product roadmap four years ago was very light as we carved the business out from TR. It's just night and day in terms of what we want to bring to market now, the degree of interoperability we have across the portfolio. It's really impressive, and investors will see that on November the 8th, which is our product strategy and product demo day. Obviously we have the presentations on the 9th. I think finally, Jerre touched on this, retention rates. Subscription retention rates currently 91%. We consider best in class 95%. We need to see that upward trajectory during 2022 and going into 2023 as we hone in on that 95% objective, which is very important. On transactional professional services, custom data sets, and other principal drivers there. Professional services, we have real scale in life sciences professional services as we do in IP professional services, where we're doing freedom to operate searches and trademark searches for our clients. It's a nice business. I am particularly attracted, as I said earlier, to that life sciences space where we sell to the top 50 life sciences organizations globally, repeat purchases. That's exactly where we want to be, and that's growing very nicely. Got it. In the last few minutes we have left, Jerre, maybe the strategy, the process you're walking through is very similar to what you did at IHS. The different verticals there obviously were a little bit more, I would say, different. The question is more science and IP together, these four or five verticals that you talked about, how do they interconnect with each other? Maybe put another way, do they have to be together? No, that's a great question. I'll just check a couple of examples. Again, as I said earlier, Manav, we've never rewarded people at all for cross-selling. This is the first year, and I'll just use a real-life example. A university, I'm supporting the sales team and service team that sells into the 20 largest research universities in the U.S. We never sold life science products in there. We never sold IP products in there, and CPA never sold management of patents in there. As an example only, good university, last year we did $554,000. We have literally today out quotes for $3.6 million. What's more exciting about that is the savings that will come to the university. In this case, four colleges have been managing their patents. We'll do that with, obviously, CPA's incredibly great products and reduce their cost by $3 out of $4. That's an example. I could go through each place, but that's what's exciting and where we're going. Got it. All right, Jerre, I think we'll end it there, and Richard as well. Thank you so much for both being here. Thank you, Manav. We very much appreciate you. All right. Thank you everybody for joining. Thank you.