S&P Global in talks to acquire IHS Markit for about $44bn

By Rahul Vaimal, Associate Editor
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S&P Global
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The American research and analytics firm S&P Global is reportedly holding discussions to acquire the London-based information provider IHS Markit for about $44 billion.

As of Friday the analytics firm, IHS Markit was valued at $36.9 billion, after a surge in its value earlier in the week. This year the stock of IHS Markit has climbed about 23 percent when compared to the 25 percent gain of S&P Global, giving it a market value of $82.2 billion.

According to a person related to the matter, the declaration regarding the merger is expected to come as early as Monday. But the representatives for both S&P Global and IHS Markit refused to respond to the acquisition news.

The potential deal is a sign of the increasing demand for data and analytics services, especially in the financial sector.

In 2016, IHS acquired the British information and services company for $9.8 billion and merged IHS’s information services with Markit’s indexes for financial products such as credit default swaps.

If completed the acquisition of IHS Markit would be the year’s second-biggest deal, following the $56 billion sets of transactions among China’s biggest oil and gas companies to sell their pipeline networks to a new national carrier.

The proposed merger comes amid a stock market rally, the S&P 500 Index closed at a record Friday. The MSCI Asia Pacific Index also climbed to a record in early Asia trading Monday.

The rally has increased the valuations for both companies with IHS Markit shares trading at 33.5 times estimated earnings, compared with 29.8 times for S&P Global.

IHS Markit

The market analytics firm IHS Markit was formed in 2016 with the merger of IHS Inc and Markit Ltd. The company currently works in combining information, analytics and expertise to offer solutions for business, finance and government. The firm currently works in 140 countries around the globe by providing its services to over 50,000 customers.

S&P Global

The S&P Global (SPGI) was founded in 1917 as the McGraw-Hill Publishing Company. The firm currently focuses on areas of financial information and analytics for businesses. SPGI is the parent organization for several companies including S&P Global Ratings, CRISIL, S&P Global Platts, S&P Dow Jones Indices, etc.