McGraw-Hill and CME Discuss Stock Market Index Venture (MHP, CME)

McGraw-Hill Companies (NYSE: MHP) and CME Group Inc. (NASDAQ: CME) are in discussions to create a stock indexes venture, according to a report by the Wall Street Journal.

The Journal, citing people familiar with the talks, reported that discussions to create a joint venture between McGraw-Hill’s S&P Indices and CME’s Dow Jones indexes unit stated over a year ago. However, the people said that the deal could still fall apart. If the two companies reach an agreement on venture, the combined indexes business venture would be managed by McGraw-Hill.

The Journal said that CME is likely to have a minority stake of around of 25% in the venture. Dow Jones & Co. could also have a stake in the venture. McGraw-Hill would have a majority stake in the joint venture.

Reports of a stock-market indexes joint venture come at a time when McGraw-Hill is planning to split its financial services and education units into two separate publicly traded companies. The Journal, citing its sources, said that if the deal goes through than the venture will be owned by the new McGraw-Hill Markets. CME currently has a 90% stake in the Dow Jones indexes.

Shares of both CME and McGraw-Hill Companies have fallen at the start of trading today. At last check, McGraw-Hill Companies shares were trading 2.86% lower at $41.10. The stock has fallen 5.84% in the last three trading sessions. In the last one month, it has fallen 2.47%. Year-to-date the stock is up 12.98%, outperforming the broad market.

CME shares, meanwhile, are currently trading 2.99% lower at $249.50. In the last three trading sessions, CME shares fell 4.88%. The stock is down 6.6% in the last one month. Year-to-date CME shares have fallen 22.53%, underperforming the broad market.

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.