The European Commission has approved, under the EU Merger Regulation, the proposed acquisition of IHS Markit by S&P Global. The approval is conditional on the divestment of businesses in the areas of commodity price assessments and financial data.

Following its investigation, the Commission was concerned that the acquisition would reduce competition, leading to potential price increases and a reduction of choice and innovation in the markets for price assessments, loan identifiers, leveraged loan market intelligence, and leveraged loan indices.

To address the Commission’s competition concerns, S&P Global and IHS Markit offered the following commitments: (i) in commodity price assessments, the divestment of IHS Markit’s Oil Price Information Service (‘OPIS’), including PetroChemWire, and Coal, Metals and Mining (‘CMM’) businesses; and (ii) in financial data and infrastructure, the divestment of a number of S&P Global businesses. These businesses will have to be divested to one or more purchaser(s) to be approved by the Commission.

These structural commitments fully remove the competition concerns identified by the Commission. The Commission therefore considered that the proposed transaction, as modified by the commitments, would no longer raise competition concerns. The decision is conditional upon full compliance with the commitments.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said:

“S&P Global and IHS Markit are leaders in the commodity and financial data markets. Without remedies, the merger would have limited customers access to some competitive and reliable data which is essential to ensure fairness of physical trades and financial markets. With this conditional approval the problematic overlaps in commodity price assessments, and also in the area of loan identifiers and indices are fully removed, to the benefit of competition.”

In November 2020, S&P Global and IHS Markit announced their entry into a definitive merger agreement to combine in an all-stock transaction which values IHS Markit at an enterprise value of $44 billion, including $4.8 billion of net debt.

Under the terms of the merger agreement, which has been unanimously approved by the Boards of Directors of both companies, each share of IHS Markit common stock will be exchanged for a fixed ratio of 0.2838 shares of S&P Global common stock. Upon completion of the transaction, current S&P Global shareholders will own approximately 67.75% of the combined company on a fully diluted basis, while IHS Markit shareholders will own approximately 32.25%.

Earlier in October, the UK Competition and Markets Authority (CMA) said it would clear S&P’s merger with IHS Markit if competition concerns in certain commodity price assessments were addressed.