McGraw-Hill Cos and CME Group Inc are in talks to combine their stock-market index businesses, uniting the Standard & Poor’s (S&P) 500 Index and the Dow Jones Industrial Average, a person with knowledge of the matter said.
In the deal under discussion, New York-based McGraw-Hill would end up with about a 75 percent stake in the combined venture, said the person, who spoke on condition of anonymity because the talks are private. Chicago-based CME would hold most of the rest and News Corp, a minority owner of the Dow Jones index business, would get a small stake, the person said.
McGraw-Hill and CME may be weeks away from reaching an agreement, the person said. The companies have been discussing a combination for about a year and recently brought News Corp into the talks, the person said.
Laurie Bischel, a spokeswoman at CME Group, said in an e-mail that the company doesn’t comment on rumor or speculation. Patti Rockenwagner, a spokeswoman for McGraw-Hill, declined to comment.
The Wall Street Journal reported the story on Thursday.
S&P’s index business is worth about US$1.7 billion, Sloan Bohlen, an analyst at Goldman Sachs Group Inc in New York, said in a Sept. 1 report. The company has grown to more than 100,000 indexes in markets globally from its index of the 500 largest US companies started in 1957.
McGraw-Hill said on Sept. 12 it would split into two companies, separating its textbook publishing business from its other media and finance businesses, which will be renamed McGraw-Hill Markets, following a strategic review that began last year. Shareholders Jana Partners LLC and Ontario Teachers’ Pension Plan proposed in August that the company break into four businesses, with the S&P index business as a standalone company.
CME Group became a publicly traded company in 2002 and merged with the Chicago Board of Trade in 2007.
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