“This agreement is very positive for both IHS Markit and Informa, increasing the focus of each company on core markets where it has particular strengths and a long-term commitment to invest and grow,” said Lance Uggla, CEO of IHS Markit and Stephen A. Carter, Group Chief Executive, Informa PLC.
“The Informa Agribusiness Intelligence portfolio is a clear extension of our Chemical and Downstream businesses and builds our existing data, pricing, insights, forecasting and news services within our Resources segment,” continued Uggla. “Agriculture is the largest end chemical market in the world and this transaction expands our capabilities into fertilizers and chemical crop protection, while substantively expanding our capabilities in biofuels.”
Carter added, “At Informa we are focused on improving our depth and specialisation around attractive customer markets. Our ambitions for Informa Tech will be further enhanced by the addition of the IHS Markit TMT portfolio, extending our customer and international reach, creating a strong platform for future growth.”
The agreement values the two exchanged businesses at equivalent EBITDA multiples, with Informa contributing an additional $30 million cash to IHS Markit to reflect the larger EBITDA contribution from the TMT business. IHS Markit will retain RootMetrics, its benchmarking business and a portion of its market intelligence business. Both transactions are expected to close in July 2019 and are subject to customary closing conditions, including US regulatory approval.
IHS Markit confirmed that the transaction will not affect its capital allocation strategy to delever its debt ratio below 3.0x and complete $500 million in share repurchases in 2019.