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McGraw-Hill Selling Education Business to Investment Group
McGraw-Hill is selling its McGraw-Hill Education business to investment funds affiliated with Apollo Global Management (Apollo) for $2.5 billion, subject to closing adjustments, and will be renamed McGraw-Hill Financial. The groups revealed today that they have signed a definitive agreement to proceed with the sale; the transaction is expected to close late this year or early next year, subject to regulatory approval and customary closing conditions.
According to Harold McGraw III, president and CEO of The McGraw-Hill Cos., the sale will "favorably position the world-class assets of McGraw-Hill Education for long-term success."
McGraw-Hill Education products and services include MacMillan McGraw-Hill, a publisher educational print and technology materials; McGraw-Hill Professional Development, a provider of training, resources, and services for teachers and administrators; CTB McGraw-Hill, a provider of testing materials and specialized educational software products; McGraw-Hill Higher Education, a publisher of instructional materials for higher education; as well as SRA, Wright Group, Glencoe, and other McGraw-Hill Education products and services.
The information released by the company did not provide details about how the sale would affect McGraw-Hill Education's products or employees, but McGraw stated, "I am proud of and grateful to all the McGraw-Hill Education professionals who are contributing so much to the company and to educators, administrators, and students all over the world. I look forward to seeing their continued success with the expertise and support of Apollo."
Larry Berg, senior partner of Apollo, said, "We look forward to leveraging the company's leading portfolio of trusted brands and innovative digital learning solutions to drive growth through the ongoing convergence of education and technology on a global basis."
McGraw-Hill Financial will become a "high-growth, high-margin benchmarks, content and analytics company in the global capital and commodities markets," according to information released by the company. As part of the sale, the company will receive $250 million in senior unsecured notes issued by Apollo at an annual interest rate of 8.5 percent.
McGraw-Hill will classify and report results of McGraw-Hill Education as discontinued operations beginning in the fourth quarter of this year.
Leila Meyer is a technology writer based in British Columbia. She can be reached at [email protected].