McGraw-Hill has confirmed an agreement to sell its education business to Apollo Global Management for a purchase price of $2.5bn, however, did not fetch the $3bn price for which the group had originally hoped

The McGraw-Hill Companies today announced it has signed a definitive agreement to sell its McGraw-Hill Education business to investment funds affiliated with Apollo Global Management, LLC (NYSE: APO) (collectively with its subsidiaries, “Apollo”), for a purchase price of $2.5 billion, subject to certain closing adjustments. As part of this transaction, McGraw-Hill will receive $250 million in senior unsecured notes issued by the purchaser at an annual interest rate of 8.5%. The transaction, which is expected to close in late 2012 or early 2013, is subject to regulatory approval and customary closing conditions.

Upon closing, McGraw-Hill, which will be renamed McGraw Hill Financial (subject to shareholder approval), will be a high-growth, high-margin benchmarks, content and analytics company in the global capital and commodities markets. With customers in more than 150 countries, McGraw Hill Financial expects 2012 revenue of approximately $4.4 billion with nearly 40% from international markets. The Company will provide 2013 financial guidance for McGraw Hill Financial when it announces its 2012 fourth quarter and year-end financial results.

“After carefully considering all of the options for creating shareholder value, the McGraw-Hill Board of Directors concluded that this agreement generates the best value and certainty for our shareholders and will most favorably position the world-class assets of McGraw-Hill Education for long-term success,” said Harold McGraw III, Chairman, President and CEO of The McGraw-Hill Companies who will lead McGraw Hill Financial once the transaction is complete. “We were able to secure an attractive outcome and create additional balance sheet flexibility for McGraw Hill Financial.”

Mr. McGraw added, “McGraw-Hill Education is a leader in digital learning with world-class content and enormously talented and committed employees. As we begin the next chapter in our rich history, I am very proud of and grateful to all the McGraw-Hill Education professionals who are contributing so much to the company and to educators, administrators and students all over the world. I look forward to seeing their continued success with the expertise and support of Apollo.”

“We are excited about this announcement and what it means for McGraw-Hill Education,” added Lloyd G. “Buzz” Waterhouse, President and CEO of McGraw-Hill Education. “Apollo is a leading global alternative investment manager and its affiliated funds have made significant investments in learning companies for more than a decade. McGraw-Hill Education’s expertise and premier brands coupled with Apollo’s resources represent a powerful combination.”

Larry Berg, Senior Partner of Apollo said, “With a longstanding track record of investing behind leaders in education, Apollo is pleased to be acquiring a marquee business that has been a pioneer in educational innovation and excellence for over a century. McGraw-Hill Education has a deep and impassioned management team, and we share their enthusiasm and strategic vision for the business. We look forward to leveraging the company’s leading portfolio of trusted brands and innovative digital learning solutions to drive growth through the ongoing convergence of education and technology on a global basis.”

“Today’s transaction marks a transformative time for our company, shareholders, customers and employees,” Mr. McGraw said. “This move builds on McGraw-Hill’s strong legacy and gives us an unprecedented opportunity to focus on accelerating the growth of our iconic brands and leading franchises such as Standard & Poor’s, S&P Dow Jones Indices, S&P Capital IQ, Platts and J.D. Power and Associates. The strong trends driving global financial markets create enormous growth opportunities for McGraw Hill Financial. As markets become more interconnected, as more borrowers around the world fund growth through the capital markets, and as technology produces more and more data in a complex world, our leading brands provide essential intelligence and independent benchmarks across asset classes and markets.”

Upon closing of the transaction, McGraw Hill Financial will have considerable balance sheet flexibility. The Company will use the estimated proceeds of approximately $1.9 billion, net of tax and certain closing adjustments, from this sale to sustain its share repurchase program, to make selective tuck-in acquisitions that enhance McGraw Hill Financial’s portfolio of powerful brands, and to pay off any short-term borrowing obligations.

Beginning in the fourth quarter of 2012, the Company will classify and report results of McGraw-Hill Education as discontinued operations. As a result of this transaction, the Company anticipates a non-cash impairment charge in the fourth quarter of approximately $450 to $550 million relating to the School Education Group.

The McGraw-Hill Companies announced in September 2011 it would separate into two industry-leading companies following a year-long strategic portfolio review. This decision was a key driver of the Company’s Growth and Value Plan, which also included a commitment to generate $100 million in cost savings and a significant share repurchase program. On November 2, 2012, the Company provided an update of its progress on these initiatives and will do so again when it announces its 2012 fourth quarter and year-end results.

McGraw-Hill received financial advice from Evercore Partners and Goldman, Sachs & Co., and legal advice from Wachtell, Lipton, Rosen & Katz and Clifford Chance.

Apollo received financial advice from Credit Suisse, UBS Investment Bank and BMO Financial Group. The financing is provided by Credit Suisse, Morgan Stanley, Jefferies, UBS Investment Bank, Nomura and BMO. Apollo received legal advice from Paul, Weiss, Rifkind, Wharton & Garrison LLP and Morgan, Lewis and Bockius LLP.

We are delighted to announce that SAGE has signed an agreement with the Royal Society of Medicine (RSM) to take over immediate publication of their RSM Journals portfolio, consisting of 28 titles within the medical field.

The Royal Society of Medicine is one of the UK’s major providers of postgraduate medical education for doctors, dentists, students and the allied health professions from around the world.  As part of this agreement we are thrilled to be publishing the RSM’s own journals including the Journal of the Royal Society of Medicine,  a highly prestigious title, one of the few general medical journals in existence, with a publishing history spanning over 200 years.

The RSM journals portfolio publishes articles on primary research and clinical practice across a broad range of disciplines, including infectious disease, health practice, women’s health and vascular medicine.  As part of this agreement, we will be partnering with some of the world’s most renowned medical organisations including the Society for Experimental Biology and Medicine.

We are incredibly excited about this acquisition: we have consistently grown our publishing in medicine for over a decade, through purchasing and launching titles – notably the Therapeutic Advances series – along with many society partnerships. These journals are closely aligned with our existing clinical medicine and broader health management portfolio, providing an even wider range of research and publication opportunities for our authors.

Speaking about the acquisition Ziyad Marar, Global Publishing Director SAGE, commented; “After a decade of growth across clinical medicine, this agreement marks SAGE out as a major medical publisher. The confidence of the Royal Society of Medicine in entrusting SAGE with the development of their own journals as well as several society relationships recognises SAGE’s strengths as a collaborative publishing partner, one that is aligned with the goals of scholarship and education, and able to combine the reach of a larger publisher with the care and personal approach of a smaller press.”

Tessa Picknett, Executive Director for STM journals added: “We are thrilled to welcome these journals to SAGE. They represent some of the very best medical research internationally, and through the publication of valuable original research and opinion pieces, help to support the improvement of human health globally”

For further information please see http://www.uk.sagepub.com/rsmjournals.sp

Alexander Brown stands up for publishers, justifying their costs and explaining how they help move science forward

“There are scores of people whose full time jobs are managing this process for a growing body of scientific literature”. Photograph: Alamy
It was not long after I arrived at Springer that I found myself – relatively new to academic publishing – immersed in the dialogue on open access (OA) and the role of publishers. The US Research Works Act was still bitterly disputed in the media, and would be another month before it died in Washington.

The more I learned about OA the more I heard accusations of publishers raking in profits while adding little value. But I just kept asking myself, “If all of these people around me are so unnecessary, then what are they doing all day, around the globe?” The answer is: a great deal to help move science forward. But just how and why is often painfully misunderstood.

The ill-conceived notion frequently advanced by commercial publishing’s detractors is that all we do is polish a manuscript, put it online and then sit back and wait for the next sucker to submit an article. This is highly misleading and inaccurate. So what are the roles and costs that justify the fees we charge?

Along with the benefits afforded to us all by the online space, publishers have also been presented with new challenges by this medium. Many assume that publishers’ costs have declined now that we no longer bear the burden of physical printing and distribution. This is true – in part. We no longer create and distribute printed materials to the extent that we have in the past. However, important new functions requiring significant expenditures have emerged to take the place of printing and shipping. And these are in addition to many of the same costs we incurred before the presses cooled.

For starters, the need for strong, skilled editors remains to ensure that research can be universally understood, to recognise emerging fields and create new journals, and to build and maintain the brands and reputations of journals. The recruitment and management of editorial review boards, and the coordination of peer review to ensure the integrity of the scholarly record, are both needed now more than ever.

To continue reading the Guardian post by Alexander Brown, please click here.

Cambridge University Press has published its annual financial results for the year ended 30 April 2012, and the results show that the publisher has achieved a tenth successive year of growth, despite challenging market conditions.

The report shows that the Press’s total sales for the year were £245 million, which is an increase of 3.8 per cent on last year, with an operating surplus of £3.4 million.

The Chief Executive of Cambridge University Press, Peter Phillips, said: “The Press is engaged in a wide-ranging process of transformation to make sure we can deliver outstanding scholarship and learning materials globally in an increasingly digital environment. That takes time and investment. But the year to April 2012 shows that we have made a good start.”

Sales of the Press’s digital products increased by 50 per cent over the previous year, and, for the first time, academic materials delivered digitally exceeded 30 per cent of the Press’s academic output. The Press’s Education group delivered a record number of new publications with accompanying e-books, interactive digital books, apps or companion websites, and Touchstone, the digital and blended English language course, has continued its high growth with new adoptions by major institutions on several continents. Cambridge Books Online, the Press’s digital platform for academic books, has also seen another significant increase in sales over the last year.

The year to April 2012 saw the Press and the University working even more closely with other parts of the University: scholars from across the research spectrum helped to drive a large-scale review of the Press’s academic publishing to ensure it continues to meet the needs of the researchers and the scholarly communities it serves. The Press also deepened its existing collaborations with Cambridge Assessment, resulting in joint Cambridge English branding, joint product development and a joint exam preparation unit.

Two major new open access mathematics journals were also commissioned, another manifestation of Cambridge’s commitment to furthering knowledge, learning and research.

The market has been challenging and the year has also seen reduced academic library budgets in North America, reduced spending on universities and schools in many parts of Europe and slower market growth in areas such as Asia.

Cambridge is already reaping benefits from reorganising its global publishing into three main groups – Academic, Education and Cambridge English – to ensure resources and decision-making are shared.

As book distribution becomes increasingly electronic, and digital printing enables shorter print runs or printing closer to customers, the need for large distribution and printing facilities has receded. As a result, the UK logistics operations were transferred to DHL and, just after the end of the year, US logistics operations moved to Ingram’s facilities in Tennessee. The Press’s UK printing operations were acquired by MPG Books Group, preserving the tradition of academic printing close to Cambridge along with the vast majority of jobs for printing colleagues.

Portico is pleased to announce that Manchester University Press (MUP) has entered into an agreement with Portico to preserve its e-journals. Through this agreement with Portico, MUP ensures that its e-journals will be preserved and available for future scholars, researchers, and students.

“We are excited to participate in Portico,” said David Rodgers, MUP chief executive. “Our journals represent the best of new research in the Humanities and Social Sciences, and Portico offers a suitably high-quality archive solution. We are very pleased that there is such a technologically advanced, well-realized solution to make our content securely and perpetually available to scholars and librarians all over the world.”

Founded in 1904, MUP is the third largest university press in England. MUP has a worldwide reputation for making innovative and high-quality scholarship available to the widest possible readership in both print and electronic formats, with particular strengths in the Humanities and Social Sciences. They manage a portfolio of 14 journals, many of which are published on behalf of or in collaboration with learned societies and institutions, and publish 145 new books a year.

Portico will be a mechanism to provide post-cancellation access to the titles committed to the archive.

Portico is pleased to announce that QScience.com has entered into an agreement with Portico to preserve its e-journals. Through this agreement with Portico, QScience.com ensures that its e-journals will be preserved and available for future scholars, researchers, and students.

“We are delighted to join Portico as our journals portfolio is growing,” Arend Kuster, managing director of QScience.com said. “Digital preservation is central to our strategy and we know that researchers, scientists, and librarians want to make sure that their research is accessible for future generations. Our recent agreement highlights that we are taking our mission to serve the authors and scholarly community very seriously and are striving to offer the best service.”

QScience.com is a collaborative, peer-reviewed online publishing platform. Developed by Bloomsbury Qatar Foundation Journals, a member of Qatar Foundation for Education, Science and Community Development, QScience.com’s goal is to create a unique and collaborative research environment for Qatar and the rest of the world.

Portico will be a mechanism to provide post-cancellation access to the titles committed to the archive.

OCLC Global Council met November 5–7 in Dublin, Ohio, to discuss direction and governance of the OCLC cooperative. Delegates heard reports from OCLC members and staff on emerging technologies and how they are impacting libraries around the world. Global Council also approved changes in regulations and bylaws of the cooperative.

Global Council passed a resolution to make changes in the Global Council bylaws by formalizing committee structures, including two new committees: Communications and Finance; clarifying officer terms; and creating a process for establishing alternate delegates.

Global Council also ratified an amendment to the OCLC Code of Regulations to discontinue the practice of the OCLC President and CEO serving as a voting member of the Board in keeping with emerging best practices among nonprofit organizations. The amendment will be effective when the next president and CEO assumes duties. Jay Jordan, OCLC President and CEO, is expected to retire by June 30, 2013. A successor has not yet been selected.

Under the direction of Global Council President ChewLeng Beh, Senior Director, Library and Professional Services and Director of SILAS National Library Board, Singapore, Global Council also heard:

An update on the OCLC Board of Trustees from Sandy Yee, incoming Chair, and Dean of the Wayne State University Libraries and Library and Information Science Program
The OCLC President’s Report, from Mr. Jordan
Report on OCLC Finance, by Rick Schwieterman, Executive Vice President and Chief Financial Officer, Treasurer, OCLC
A presentation, “The Library Scene in The Netherlands,” by Anja Smit, University Librarian, Utrecht University, Netherlands
“Linked Data – Radical Change?” presented by Richard Wallis, Technology Evangelist, OCLC
“Wikipedians and Librarians: Two Communities Separated by Common Goals,” a presentation by Max Klein, OCLC Wikipedian in Residence, and Merilee Proffitt, Senior Program Officer, OCLC Research.
Global Council heard committee and advisory group reports:

The Bylaws Committee clarified recommended changes up for vote
The Communications Committee discussed ways to facilitate more and better communication
The Credits Advisory Group discussed the future of cataloging credits; the committee continues to gather input from members on this topic for discussion from webinars, listservs and other communications activities.
Delegates also participated in small group discussions that examined trends and issues in libraries and information science, including data quality, security, archive and museum interests, among others.

The OCLC Global Council meeting was webcast live. Video from the webcast is posted on the OCLC website.

OCLC Global Council comprises Member Delegates elected by the members within each of the three Regional Councils—Americas, Asia Pacific and EMEA—and serves as a key strategic discussion forum and the major communication link among member libraries, Regional Councils and OCLC. Global Council helps shape the future direction of OCLC and libraries by electing six members to the OCLC Board of Trustees and ratifying amendments to the OCLC Code of Regulations and Articles of Incorporation. The Global Council also discusses interests of mutual concern and makes recommendations to OCLC management and members of the OCLC Board of Trustees. Member Delegates also help to ensure regular and open communication between the Membership and OCLC.