The Year's Biggest Merger Lifts This Blank-Check Stock
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BILL PETERS12:05 PM ET 11/30/2020
Market research stocks rose Monday after financial data and debt-rating firm S&P Global (SPGI) on Monday said it would buy rival IHS Markit (INFO) for $44 billion, in the biggest merger deal so far this year.
The all-stock deal will form a massive competitor in the field of financial market data services, where demand for computer workstations and analytics software has increased as investing becomes more complex. The companies expect the deal to close in the second half of next year.
"Serving a global customer base across financial information and services, ratings, indexes, commodities and energy, and transportation and engineering, the pro forma company will provide differentiated solutions important to the workflows of many of the world's leading companies," S&P Global said in a statement.
The $44 billion valuation for London-based IHS includes $4.8 billion in net debt. Additionally, under terms of the deal, each share of IHS Markit stock will be exchanged for a fixed ratio of 0.2838 shares of S&P Global stock.
As a result, SPGI stockholders will own around 67.75% of the combined company when the deal closes. IHS Markit shareholders will own 32.25%.
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IHS Markit Tops 100, Bloomberg Looms
Meanwhile, market research stocks broadly rose on the news. IHS Markit jumped 9% to 100.70 in the stock market today. SPGI stock rose 2%, and was in a consolidation.
Among other market research stocks, Moody's rose 1.3% to 280.80. That stock was in a double-bottom base with a 298.28 entry. Shares were just above their 50-day line on Monday. FactSet (FDS) rose 3.5% and is also consolidating.
Pershing Square Tontine Holdings (PSTH), a blank-check company backed by billionaire investor Bill Ackman's hedge fund Pershing Square Holdings, rose 6%.
The New York Post last month reported that Michael Bloomberg, the former New York City mayor, was considering taking his Bloomberg media business public via the blank-check company. A spokesman for Bloomberg denied that such a deal was being considered, the Post said.
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Such market research firms process the flood of financial market data on stocks, bonds, commodities and earnings figures into chart form to help investors act quickly in a market where fortunes can turn within a fraction of a second.
In the meantime, artificial intelligence has played a bigger role in helping to compile that data. S&P Global has begun incorporating more climate-change analysis into its data.
SPGI stock rose for much of this year, after more companies took on more debt to weather the coronavirus crisis, and central banks kept borrowing costs low and bought more bonds to help their economies.
The increase in borrowing by companies led to more work for companies like S&P Global and Moody's (MCO), that put a grade on that debt to help investors determine how risky that debt is and if it's worth the investment.
However, Burton-Taylor International Consulting said in August that spending on financial market data should slip next year. The firm said the financial industry "remains uncertain" on the pandemic's influence on market-data spending.
https://research.investors.com/stock-qu ... d-info.htm
. Now the provider of credit ratings, benchmarks and analytics in the global capital and commodity markets is trying to buck pressure in the stock market indexes and break out.