S&P Global → IHS Markit

An all-stock combination valued at $44bn — the largest deal of 2020 — that put credit ratings, market indices, commodity price benchmarks and financial data in one company, concentrating the information the financial industry pays for into a handful of suppliers.

An all-stock combination concentrating financial indices, ratings and commodity data in one group, including $4.8bn of net debt.

Value

$44B

Announced

November 2020

Completed

February 2022

Sector

Fintech

Deal type

merger

Acquirer

S&P Global (United States)

Target

IHS Markit (United Kingdom)

Why it mattered

S&P Global owned the ratings agency, the S&P indices and Platts; IHS Markit owned the CDS and bond pricing data that markets clear against, the PMI economic surveys, and the automotive, energy and maritime data businesses. Neither needed the other to operate; both needed scale in the data business, where the buyers — banks, asset managers, corporates — consolidate their suppliers and pay for breadth. The deal was priced at a modest premium because it was a merger in all but name, with S&P shareholders holding 68% of the combined company.

Competition clearance took fifteen months and required the sale of IHS Markit's Oil Price Information Service, its coal and metals data, and its base-chemicals business, and of S&P's CUSIP identifier business — the regulators' concern being the combination's grip on the benchmarks and identifiers that markets cannot trade without.

What it left behind

A financial-data industry organised around four groups — S&P Global, LSEG with Refinitiv, Bloomberg and Moody's — each combining a ratings or exchange franchise with the data that trades on it. For fintechs building on market data it meant fewer, larger suppliers; for deal-makers it was the model of a scale merger in a business where the customers are the same few hundred institutions.