Educational publishing merger raises competition concerns
The CMA has found that McGraw-Hill鈥檚 takeover of competitor Cengage could leave students worse off.
The Competition and Markets Authority (CMA) is concerned that the loss of competition brought about by the proposed merger could result in university textbooks costing more.
McGraw-Hill and Cengage are two leading publishers, producing textbooks and associated materials, for higher education students.
Joel Bamford, Senior Director of Mergers at the CMA, said:
鈥淩ecord numbers of people are looking to go to university . This reinforces just how important it is that we look at this deal.
鈥淭his proposed merger would bring together two important suppliers in the UK and could lead to students paying more for essential textbooks and educational materials.鈥�
Throughout its Phase 1 investigation, the CMA identified that both companies produce materials across a wide range of subjects in the UK. It looked at where McGraw-Hill and Cengage overlap, finding 379 courses where both companies offered textbooks.
The CMA assessed the effect of the merger on individual courses based on market shares, the companies鈥� own documents and feedback from retailers, lecturers and publishers. The CMA identified 51 courses of concern where McGraw-Hill and Cengage would have high combined market shares 鈥� in some cases more than 80% 鈥� or where there would otherwise be very limited competition after the deal went ahead.
Both companies are headquartered in the United States but operate across the world. The CMA has worked closely with the US Department of Justice and the Australian and New Zealand competition agencies in scrutinising this deal.
McGraw-Hill and Cengage must now address the CMA鈥檚 concerns within 5 working days. If they鈥檙e unable to do so, the merger will be referred for an in-depth (Phase 2) investigation.
For more information, visit the McGraw-Hill Education / Cengage Learning Holdings merger inquiry page.