McGraw-Hill may be moving toward split


It may not just be some investors who think it would be a good idea to split McGraw-Hill Companies in two. The Wall Street Journal reports that the company itself is now looking seriously at the split idea.

JANA Partners and the Ontario Teachers’ Pension Plan Board, which is advised by JANA, disclosed early this month that they have been pressing the McGraw-Hill board to divide the company. The idea would be to separate the challenged education division from the fast-growing financial segment.

At that time the company said only that it is “conducting a comprehensive portfolio review” and noted that it had already put its TV station operation up for sale.

Now the Wall Street Journal reports that McGraw-Hill’s management and board is seriously considering a spin-off of its education division. In fact, the WSJ’s sources say Evercore Partners was hired back in March to assess options for the education business. McGraw-Hill has not commented on the report, which was quickly matched by the New York Times DealBook.

RBR-TVBR observation: As we noted previously, some splits of this sort work out better than others. Certainly the argument can be made that the financial segment would be better off without the drag of the education unit.