The century-old education giant McGraw Hill (MH.US), which has a debt of 3.2 billion US dollars and is still facing the impact of AI, sprint to the NYSE

The Zhitong Finance App learned that McGraw Hill Inc. (McGraw Hill Inc.) plans to publicly issue shares in the US stock market, raising a maximum of about 537 million US dollars, which means that this education-focused company will join the US midsummer listing boom in a high-profile manner.

The Columbus, Ohio-based company will issue 24.4 million shares at an issue price range of $19 to $22 per share, according to documents submitted to the US Securities and Exchange Commission on Monday. If the upper limit of the range is calculated, the market value of McGraw Hill would reach 4.2 billion US dollars based on the issued shares listed in the document.

According to documents, Platinum Private Equity acquired the education company from alternative asset management giant Apollo Global Management Inc. (Apollo Global Management Inc.) at a valuation of 4.7 billion US dollars in 2021. It is expected that after the end of this stock offering, Platinum will control nearly 87% of McGraw Hill's shares. McGraw Hill is headquartered in Columbus and has a total debt of up to $3.2 billion.

The US initial public offering (IPO) market temporarily shut down in April after President Donald Trump announced the tariff policy, and is now recovering rapidly. According to data compiled by Bloomberg, after excluding financial market instruments such as blank check companies, the US stock IPO raised 4.3 billion US dollars in June, the highest number in a single month since September 2023.

NIQ Global Intelligence Plc, the former consumer intelligence business unit of Nielsen Holdings, also submitted a US stock IPO application on Monday, planning to raise up to 1.2 billion US dollars.

Documents show that in the full fiscal year ending March 31 this year, McGraw Hill had revenue of about 2.1 billion US dollars and a net loss of 85.8 million US dollars; the previous fiscal year had revenue of 1.96 billion US dollars and a net loss of 193 million US dollars.

This textbook publisher, founded in 1888, has embraced digital education tools, including an artificial intelligence-based math teaching program and an AI Reader trained with high-quality course content. According to the document, its products cover K-12, university, and vocational learning fields. It has approximately 26 million paid digital users in the fiscal year ending March 31, providing digital and paper textbooks, adaptive learning software, and teaching evaluation services around the K-12, university and vocational training markets.

McGraw Hill's digital learning platforms include: ALEKS — an artificial intelligence-based adaptive math and chemistry learning system that can dynamically diagnose knowledge gaps and personalize exercises and explanations; Connect and e-Book — providing interactive courseware, automatic evaluation and learning progress analysis for higher education courses; and AI Reader — using generative AI to transform course content into voice and intelligent tutoring materials to achieve a barrier-free reading experience.

The document points out that generative artificial intelligence is also one of the potential risks facing McGraw Hill's overall business because it may make it easier for competitors to produce teaching materials and make it easier for student groups to obtain high-quality learning materials. AI may also drastically lower the production threshold for alternative textbooks, which together greatly weakens the company's pricing capacity and market share, and seriously affects market demand.

McGraw Hill previously secretly submitted a listing application in 2022, and even earlier, it withdrew its earlier listing plan in 2018.

Thirteen major Wall Street banks, including Goldman Sachs Group, Bank of Montreal, J.P. Morgan Chase, Macquarie Capital, and Morgan Stanley, are participating in this underwriting. The company plans to list and trade on the New York Stock Exchange under the ticker symbol “MH.”

Overall, McGraw Hill is an established education company that has transformed from traditional paper textbooks to digital learning technology. It strives to stabilize the North American market with new AI technology to empower adaptive course platforms, and use IPOs to reduce the burden of private equity debt and raise funds for digital expansion. However, the future growth model remains uncertain due to its highly leveraged structure and competition caused by generative AI.