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McGraw-Hill’s Pieces Gain 40% More Than Current Value: Real M&A

McGraw-Hill Cos., which does everything from selling textbooks to rating government bonds and compiling car surveys, may be worth at least 40 percent more if sold and broken into pieces.

Founded by Sir James McGraw after he bought the “American Journal of Railway Appliances” in 1888, McGraw-Hill has lost a third of its value since 2006 as budget cuts by state and local governments caused school textbook sales to fall in four of the past five years and its AAA ratings on bonds backed by subprime mortgages proved to be wrong. The $12 billion company, which also owns Standard & Poor’s and J.D. Power & Associates, yesterday traded for less per dollar of revenue than any of its closest rivals, according to data compiled by Bloomberg.