US education groups McGraw-Hill and Cengage plan all-stock merger

KEY POINTS

• Educational publishers McGraw-Hill Education and Cengage Learning announced plans for an all-stock merger.
• The merged company will be titled McGraw Hill and will hold about $3.16 billion in annual revenue.
• The deal, if completed, would see the new company become the U.S.'s second-largest provider of college textbooks and other higher-education materials.

The McGraw-Hill Cos. signage is displayed outside of the company's headquarters in New York, U.S.

Bloomberg | Getty Images

Educational publishers McGraw-Hill Education and Cengage Learning are planning an all-stock merger, McGraw-Hill said on Wednesday.

The merged company will be named McGraw Hill and will hold about $3.16 billion in annual revenue, both companies had earlier told The Wall Street Journal, which first reported the deal.

If the deal stands through, the new company would become the second-largest provider of college textbooks and other higher-education materials in the United States, the report said.

Cengage Learning Chief Executive Officer Michael Hansen will head the new firm, McGraw-Hill confirmed.

The merged entity, which could be valued at about $5 billion, would help both U.S.-based educational publishers to compete better as the rise of digital books and course materials pressures their businesses.