US-based educational publisher McGraw-Hill is set to change hands under a private equity-backed takeover.

Platinum Equity has announced it has reached an agreement to buy McGraw-Hill from Apollo Global Management in a deal worth around $4.5 billion, including debt, according to the Wall Street Journal.

The takeover of one of the US’s largest educational publishers comes around a year after it terminated talks with rival Cengage about a $5 billion tie-up after the firms failed to agree a series of divestments with the Department of Justice.

Founded in 1888, McGraw-Hill’s history lies in print. But the acquisition announcement signals that the company’s new owners envision a digital future for the brand.

McGraw-Hill reports that its digital products generate more than $1 billion annually, accounting for 60% of its revenue and more than 80% of its higher education unit.

The deal comes at a time of change in the educational publishing sector, in which some of the largest players are revaluating their strategies and placing on the block businesses not considered core in their digital-led futures. Pearson, the UK’s biggest educational publisher, is weighing a carve-out of a £300 million courseware division, as reported exclusively by this publication.

Platinum Equity, headquartered in Los Angeles with more than $25 billion in assets, has around 40 companies in its portfolio, although neither education nor publishing are well-represented. It owns yearbook and class-ring company Jostens.

Date published: 21 June 2021

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