McGraw Hill Financial to buy SNL Financial for $2.225 bn

McGraw Hill Financial Inc, owner of Standard & Poor's Ratings Services, today struck a deal to buy financial news and data services provider SNL Financial for $2.225 billion in cash.

SNL Financial is owned by private equity firm New Mountain Capital and current and former members of SNL management.

McGraw Hill is expected to fund the transaction with approximately $525 million in cash and $1.7 billion in new debt, and expects to close the transaction in the third quarter of 2015.

Excluding amortization, the transaction is expected to be accretive to adjusted diluted EPS in 2016, and, on a GAAP basis, in 2018. 

McGraw Hill said that it has identified approximately $70 million in synergies which are expected to be fully realized by 2019 largely from operational efficiencies and its own ability to accelerate SNL's international growth through its global footprint.  

Founded in 1987 and based in Virginia, SNL has more than 5,000 customers across banks, insurance companies, corporations, asset managers, power companies and other users.

SNL's areas of operation include financial institutions, real estate data on 500+ global REITs, energy, financial coverage of 225+ public companies, reports of hundreds of listed companies, US and European TV networks, and metals and mining data on more than 60 countries.

McGraw Hill is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics.

The company's brands include Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, and J.D. Power.

"We are enthusiastic about SNL because it is a fast-growing, highly complementary subscription-based business that will enable us to accelerate our strategy to be the leading provider of transparent and independent benchmarks, analytics, data and research across the global capital, commodity and corporate markets," said Douglas Peterson, president and CEO of McGraw Hill.

"Adding SNL to our portfolio creates a high-growth market data and analytics business that will leverage the power of the S&P Capital IQ and Platts global platforms to realize the full potential of SNL's financial and commodities products," he added.