IHS buys Markit to create US$13b firm
Print Edition
US-BASED IHS Inc has agreed to buy Markit Ltd to create a US$13 billion London-based data and business research provider, in the latest example of a US company moving its domicile overseas where corporate tax rates are lower.
The companies yesterday said IHS shareholders will own about 57 percent of the combined company following the close of the all-stock deal, which values Markit at about US$5.9 billion.
Colorado-based IHS, whose businesses include Jane’s Defence Weekly and technology industry research firm iSuppli, will pay the equivalent of US$31.13 per Markit share, a premium of 5.6 percent to Markit’s Friday close.
Markit, founded in 2003 by ex-TD Securities credit trader Lance Uggla in a barn north of London, provides pricing and reference data, index and valuation services.
IHS Chief Executive Jerre Stead will become chairman and chief executive of the combined company, IHS Markit.
Uggla will be president for now and take over the top job after Stead’s retirement on December 31 next year.
IHS shareholders will get 3.5566 shares of the combined company for each share held.
IHS Markit, while keeping some “key” operations in Colorado, will be based in London.
So-called tax inversion deals have become the subject of a fierce political debate in the US as well as a source of concern for the government over the potential loss of tax revenue.
“We don’t see this transaction as being implicated by the US anti-inversion rules,” IHS Chief Financial Officer Todd Hyatt told analysts.
IHS said the combined company was set to have a tax rate in the low to mid-20 percent range.
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