Publishing/Writing: Insights, News, Intrigue

11/26/2012

McGraw-Hill + Apollo Management = Converging Education and Technology on a Global Basis?


Nice sounding title — but, the proposed purchase of McGraw-Hill Education by the private equity firm Apollo Global Management (a bloated name for a private equity firm — and whenever I hear ‘private equity firm’ I picture vulture capitalist firm Bain Capital) could just be a financial survival move.

While researching this publishing event I did come to realize how diversified McGraw-Hill actually was AND also the popular brand names that had been bought or invested in by Apollo.

For instance McGraw-Hill publishes numerous textbooks and magazines, including Architectural Record and Aviation Week, and is the parent company of Standard & Poor’s, Platts, and J.D. Power and Associates. It is the majority owner of the Canadian publisher McGraw-Hill Ryerson (TSX).  

And Apollo owns AMC Entertainment, Claire’s, Caesars Entertainment Corporation, Norwegian Cruise Line, and Realogy (Coldwell Banker and Century 21 Real Estate), CKE (Hardee’s and Carl’s Jr. Restaurants. Ltd) and CKX, Inc. (American Idol, Elvis Presley, Muhammad Ali)  

This PR Newswire from Bloomberg Businessweek gives details of the proposed sale along with some interesting financial numbers:

McGraw-Hill to Sell Education Business to Apollo for $2.5 Billion
 

NEW YORK, Nov. 26, 2012 /PRNewswire-FirstCall/ — The McGraw-Hill Companies (NYSE: MHP) (“the Company”) today announced it has signed a definitive agreement to sell its McGraw-Hill Education business to investment funds affiliated with Apollo Global Management, LLC (NYSE: APO) (collectively with its subsidiaries, “Apollo”), for a purchase price of $2.5 billion, subject to certain closing adjustments. As part of this transaction, McGraw-Hill will receive $250 million in senior unsecured notes issued by the purchaser at an annual interest rate of 8.5%.  The transaction, which is expected to close in late 2012 or early 2013, is subject to regulatory approval and customary closing conditions.

Upon closing, McGraw-Hill, which will be renamed McGraw Hill Financial (subject to shareholder approval), will be a high-growth, high-margin benchmarks, content and analytics company in the global capital and commodities markets. With customers in more than 150 countries, McGraw Hill Financial expects 2012 revenue of approximately $4.4 billion with nearly 40% from international markets. The Company will provide 2013 financial guidance for McGraw Hill Financial when it announces its 2012 fourth quarter and year-end financial results.

“After carefully considering all of the options for creating shareholder value, the McGraw-Hill Board of Directors concluded that this agreement generates the best value and certainty for our shareholders and will most favorably position the world-class assets of McGraw-Hill Education for long-term success,” said Harold McGraw III, Chairman, President and CEO of The McGraw-Hill Companies who will lead McGraw Hill Financial once the transaction is complete. “We were able to secure an attractive outcome and create additional balance sheet flexibility for McGraw Hill Financial.”

Mr. McGraw added, “McGraw-Hill Education is a leader in digital learning with world-class content and enormously talented and committed employees. As we begin the next chapter in our rich history, I am very 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.”

“We are excited about this announcement and what it means for McGraw-Hill Education,” added Lloyd G. “Buzz” Waterhouse, President and CEO of McGraw-Hill Education. “Apollo is a leading global alternative investment manager and its affiliated funds have made significant investments in learning companies for more than a decade. McGraw-Hill Education’s expertise and premier brands coupled with Apollo’s resources represent a powerful combination.”

Larry Berg, Senior Partner of Apollo said, “With a longstanding track record of investing behind leaders in education, Apollo is pleased to be acquiring a marquee business that has been a pioneer in educational innovation and excellence for over a century. McGraw-Hill Education has a deep and impassioned management team, and we share their enthusiasm and strategic vision for the business. 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.”

“Today’s transaction marks a transformative time for our company, shareholders, customers and employees,” Mr. McGraw said. “This move builds on McGraw-Hill’s strong legacy and gives us an unprecedented opportunity to focus on accelerating the growth of our iconic brands and leading franchises such as Standard & Poor’s, S&P Dow Jones Indices, S&P Capital IQ, Platts and J.D. Power and Associates. The strong trends driving global financial markets create enormous growth opportunities for McGraw Hill Financial.  As markets become more interconnected, as more borrowers around the world fund growth through the capital markets, and as technology produces more and more data in a complex world, our leading brands provide essential intelligence and independent benchmarks across asset classes and markets.”

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09/30/2010

Publishing Espionage, Continued


Ahhh, the dark world of publishing espionage is getting downright dizzying!

After filing a lawsuit against McGraw-Hill (refer to my post of 9/28/10 More on Publishing Espionage), Reed Business Information publishers (RBI) has had a lawsuit filed against itself for “misconduct” by another construction information publisher, BidClerk Inc.

Even more from FOLIO magazine’s Jason Fell:

The proverbial table has been turned for Reed Business Information. Following a suit its Reed Construction Data unit brought against rival McGraw-Hill Construction Dodge, the publisher is now facing a lawsuit brought against it by construction information service provider BidClerk Inc.

According to the complaint, filed in Minnesota U.S. District Court, BidClerk alleges that a series of “denial of services” attacks were directed against its online system, flooding it with “millions of page views.” It also alleges that a “click fraud’” scheme aimed at BidClerk’s paid advertisements generated “hundreds of thousands” of invalid clicks and impressions on its ads.

BidClerk claims the attacks originated from an IP address belonging to RBI. Meanwhile, RBI denies BidClerk’s allegations that it, or any of its employees, “intentionally engaged in internet activity designed to harm BidClerk.” It says it will “vigorously” defend itself against these claims.

Read more http://alturl.com/zodtu

09/28/2010

More on Publishing Espionage


I initially posted on the espionage lawsuit filed against McGraw-Hill by Reed Construction Data publishers on 11/25/2009: McGraw-Hill Fights RBI’s Espionage Lawsuit and again on 12/16/2009: Reed Expands ‘Espionage’ Lawsuit Against McGraw-Hill

Here’s the latest intrigue unfolding in this publishing business drama.

Folio Magazine’s Jason Fell, who has been following this espionage court case, updates his initial reports:

Court Dismisses Three Counts in Reed ‘Espionage’ Case Against McGraw-Hill Construction

A New York U.S. District Court judge has ruled in favor of McGraw-Hill Construction Dodge to dismiss three of the counts brought against it last year by competitor Reed Construction Data alleging corporate espionage, among other things.

Specifically, the ruling dismisses the counts alleging violation of the New York General Business Law consumer fraud statute, violation of the Racketeer Influenced and Corrupt Organizations Act (RICO) and conspiracy to violate RICO. The ruling was filed on September 14. The litigation concerning the remaining eight counts is ongoing.

“We are very pleased with the judge’s ruling dismissing the RICO claims and state law consumer fraud claim and remain confident that we will prevail on the merits with respect to the remaining counts in the litigation,” McGraw-Hill Construction says in a statement e-mailed to FOLIO:.

Read more http://alturl.com/t3tt5

12/16/2009

Reed Expands ‘Espionage’ Lawsuit Against McGraw-Hill


Here is the latest on the espionage lawsuit Reed Construction Data (RCD) filed against McGraw-Hill Publishers (Construction Dodge Division) last October. I initially posted on this lawsuit three weeks ago, 25 Nov 2009. You can get initial information by reviewing that post if you wish.

Folio Magazine’s Jason Fell, who has been following this espionage court intrigue, updates his initial report:

Reed Construction Data, a unit of b-to-b publisher Reed Business Information, has expanded the lawsuit it filed in October charging corporate espionage against McGraw-Hill Construction Dodge.

RCD’s amended complaint, filed Friday in federal court, alleges that Dodge also used access to RCD’s database to misappropriate its construction information by downloading hundreds of project-related documents. After viewing “specific details for thousands of construction projects,” RCD charges that Dodge subsequently used the information to populate its own database.

According to RCD’s original 60-page complaint, it claims Dodge unlawfully accessed confidential and secret trade information from RCD by hiring consultants to subscribe to RCD’s confidential data, using made up names and fake companies. It also alleges that Dodge manipulated the RCD information to create “misleading comparisons” between Dodge and RCD’s products and services “in an attempt to mislead the marketplace.”

The RCD complaint cites 11 counts of misconduct by Dodge dating back to 2002 and says efforts to obtain competitive information from RCD dates back to “the mid- to late-1990s.” Late last month, McGraw-Hill filed a motion to dismiss five counts, including those alleging misappropriation of confidential information, tortious interference with prospective economic advantage, violation of New York General Business Law, violation of the Racketeer Influenced and Corrupt Organizations Act (RICO) and conspiracy to violate RICO.

The motion, however, did not request the dismissal of the other counts alleging fraud, misappropriation of trade secrets, unfair competition, monopolization, and others. RCD’s legal counsel declined to comment about McGraw-Hill’s motion.

RCD is seeking an unspecified amount in lost profits, punitive damages and injunctive relief. McGraw-Hill has said RCD’s suit is “without merit,” and that it intends to defend itself “vigorously.”

11/25/2009

McGraw-Hill Fights RBI’s Espionage Lawsuit


I TOLD you there was intrigue in the publishing industry!
A great account of the latest in this espionage lawsuit is given by Jason Fell of FOLIO magazine:

McGraw-Hill has filed a motion to dismiss five counts of misconduct brought against it in a lawsuit filed last month by Reed Construction Data, a unit of b-to-b publisher Reed Business Information. The suit charges corporate espionage, among other things.

The motion was filed Friday by McGraw-Hill in U.S. district court in New York.

Reed’s 60-page complaint alleges that McGraw-Hill’s Dodge Construction division unlawfully accessed confidential and secret trade information from RCD by hiring consultants to subscribe to RCD’s confidential data, using made up names and fake companies. It also alleges that Dodge manipulated the RCD information to create “misleading comparisons” between Dodge and RCD’s products and services “in an attempt to mislead the marketplace.”

McGraw-Hill’s motion requests that the court dismiss the counts alleging misappropriation of confidential information, tortious interference with prospective economic advantage, violation of New York General Business Law, violation of the Racketeer Influenced and Corrupt Organizations Act (RICO) and conspiracy to violate RICO.

The motion, however, did not request the dismissal of the other counts alleging fraud, misappropriation of trade secrets, unfair competition, monopolization, and others.

“We will address those allegations as part of our response to the entire lawsuit,” a McGraw-Hill spokesperson told FOLIO:. It was not immediately clear, however, exactly when or how the company would issue a formal response.

Construction President Out

On November 9, McGraw-Hill announced to staff that longtime McGraw-Hill Construction president Norbert Young had left the company. Glenn Goldberg, president of McGraw-Hill Information & Media would assume responsibility for the construction group, assisted by Robert Stuono, the group’s senior vice president and general manager.

The spokesperson declined to say if Young’s departure was related to the Reed lawsuit, saying that as a policy the company does not comment on personnel issues.

10/13/2009

McGraw-Hill Sells BusinessWeek to Bloomberg

Filed under: auction,book publishing,BusinessWeek,McGraw-Hill — gator1965 @ 5:10 pm

Breaking news from FOLIO, the magazine for magazine management:

BREAKING: McGraw-Hill Sells BusinessWeek to Bloomberg By Jason Fell

Acquisition will ‘yield huge benefits for users of the Bloomberg terminal.’

After a weeks-long auction process, the McGraw-Hill Companies late Tuesday announced it that has agreed to sell BusinessWeek to Bloomberg L.P., the expected favorite among remaining bidders…the rest of the story @ http://alturl.com/66mq

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