S&P, Markit to Sell Fuel-Data Arm to News Corp. to Ease Merger
(Bloomberg) -- S&P Global Inc. and IHS Markit Ltd. agreed to sell fuel-price and other commodities information services to News Corp. for $1.15 billion, aiming to smooth regulatory approval for a planned $39 billion merger.
The sale of Markit’s Oil Price Information Services, PetroChem Wire and Coal, Metals and Mining businesses is expected to close with the S&P-Markit combination in the fourth quarter, subject to regulatory approval, according to a statement Monday.
S&P and Markit said in May that they would explore the sale of the operations to ensure that their deal would be approved, responding to feedback from regulators. OPIS provides daily price information used by commodity traders around the world, not just for crude oil but for an array of fuels including gasoline and diesel.
S&P rose less than 1% to $431.90 at 9:37 a.m. in New York, while Markit gained less than 1% to $117.80. News Corp. Class A shares were little changed at $24.76.
What Bloomberg Intelligence says:
“News Corp.’s purchase of Oil Price Information Service for $1.15 billion in cash is yet another instance of an aggressive M&A strategy that has focused on digital data, research and analytics. The price represents an estimated 18x forward Ebitda multiple but is logical as it rounds out the Dow Jones portfolio, which has 3.3 million digital and 4.3 million total subscribers.
-- Geetha Ranganathan, BI industry analyst
-- Kevin Near, BI media analyst
News Corp., owner of the Wall Street Journal, said the purchases would become part of its Dow Jones Professional Information Business, which includes its news wire, a risk and compliance service and the Factiva research tool.
Bloomberg LP, the parent of Bloomberg News, competes with Dow Jones Newswires in delivering financial news and information.
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