- McGraw Hill raises $414.6M in IPO, pricing shares at $17, below the expected range; company valued at ~$3.25B and trades under the symbol 'MH'.
- IPO marks return to public markets after 13 years, with Platinum Equity retaining 84.6% stake; proceeds will primarily reduce debt.
- With 65% revenue from digital platforms and presence in 82% of U.S. colleges, McGraw Hill is positioned to grow amid an edtech-driven transformation.
McGraw Hill Inc., the century-old U.S. education publisher based in Columbus, Ohio, has raised $414.6 million in its debut stock sale, pricing shares at $17 each that fall well short of the initially targeted range of $19 to $22. Sales of 24.39 million shares value the company at around $3.25 billion, and all shares that are being traded publicly will start trading under the symbol "MH" on the New York Stock Exchange.
Originally a unit of the McGraw-Hill Companies prior to its spin-off, the publisher was taken private almost 13 years ago by Apollo Global Management. Platinum Equity bought the company in 2021 for approximately $4.5 billion, and after the IPO, it will still hold a controlling interest of about 84.6%. The transaction is the company's return to public markets when IPO activity is experiencing renewed vigor in the U.S., with private equity-backed companies being big beneficiaries.
During the fiscal year ended March 31, McGraw Hill registered a 7% rise in revenue, crossing the $2 billion mark, while reducing net losses from $193 million the previous fiscal to $85.8 million. Even though the company operates in a tough textbook market, it is experiencing a vast digital transformation. Reports from the industry indicate that it generates nearly 65% of its revenues from digital platforms like Connect and ALEKS indicative of an overall shift in educational content delivery.
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The IPO proceeds will be used strategically primarily to lower debt from its term loan facility although Platinum Equity will retain majority ownership. Analysts indicate the company's valuation of about $3.25 billion will be conservative, considering both the large debt burden it has and the evolving nature of the edtech sector.
The public offering follows a wave of renewed IPO activity, especially among larger, more mature companies using private equity sponsorship to list. Companies such as McGraw Hill and NIQ Global Intelligence are gauging investor demand for established companies with solid revenue streams and large scale.
With a proven track record spanning more than 82% of U.S. colleges and universities employing its technology and a digitally and AI-oriented approach, McGraw Hill seems in good position to leverage its history while responding to changing market needs. Its return to public markets highlights both the company's strategic shift and the larger trend of education technology companies raising funds for the next phase of expansion.
