Acquisitions and Divestitures

Acquisitions

During the six months ended June 30, 2013, we did not complete any acquisitions.

In June of 2013 we made a voluntary open offer to purchase up to an additional 22.23% of the total equity shares outstanding in CRISIL Limited, our majority owned Indian credit rating agency within our S&P Ratings segment. Full acceptance of the offer would increase our total stake in CRISIL to 75% from 52.77%.

As part of CRISIL's acquisition of Coalition Development Ltd. in July of 2012 we made a contingent purchase price payment in the first half of 2013 for $12 million that has been reflected in the consolidated statement of cash flows as a financing activity.

During the six months ended June 30, 2012, we completed the following acquisitions:


•	On June 29, 2012, we closed our transaction with CME Group, Inc. ("CME Group") and CME Group Index Services LLC ("CGIS"), a joint venture between CME Group and Dow Jones & Company, Inc., to form a new company, S&P Dow Jones Indices LLC.


•	On June 29, 2012, we acquired Credit Market Analysis Limited ("CMA") from the CME Group. CMA provides independent data concerning over-the-counter markets. CMA's data and technology will enhance our capability to provide pricing and related over-the-counter information. CMA was integrated into our S&P Capital IQ segment.


•	On April 3, 2012 we completed the acquisition of QuantHouse, an independent global provider of end-to-end systematic low latency market data solutions. QuantHouse was integrated into our S&P Capital IQ segment. The acquisition allows us to offer unique real-time monitors, derived data sets and analytics as well as the ability to package and resell this data as part of a core solution.


•	On February 8, 2012, we completed the acquisition of R² Technologies (“R²”). R² provides advanced risk and scenario-based analytics to traders, portfolio and risk managers for pricing, hedging and capital management across asset classes. R² was integrated into our S&P Capital IQ segment.

None of these acquisitions were material either individually or in the aggregate, including the pro forma impact on earnings.

Divestitures

On July 24, 2013, we announced a definitive agreement to sell Aviation Week within our C&C segment to Penton, a privately held business information company. We expect this transaction will close following the receipt of regulatory approvals and completion of customary closing conditions.

On November 26, 2012, we entered into a definitive agreement to sell MHE to investment funds affiliated with Apollo Global Management, LLC and on March 22, 2013, we completed the sale for a purchase price of $2.4 billion in cash. We recorded an after-tax gain on the sale of $612 million, which is included in discontinued operations, net in the consolidated statement of income for the six months ended June 30, 2013. We have used a portion of the after-tax proceeds from the sale to pay down short-term debt, in part driven by the special dividend paid in 2012, and to continue share repurchases. We will also continue to use a portion of the after-tax proceeds to make selective acquisitions and investments.

In connection with the sale, we have entered into transition service agreements designed to ensure and facilitate the orderly transfer of MHE's business operations to the buyer. Under the terms of these agreements, we will provide various services to MHE for an expected period of three to twelve months from the date of the sale.

The key components of income from discontinued operations for the periods ended June 30 consist of the following:



(in millions)	Three Months						Six Months
	2013			2012			2013			2012
Revenue	$	—		$	474		$	268		$	769
Expenses	(2		)	417			312			774
Operating income (loss)	2			57			(44		)	(5		)
Interest expense (income), net	—			—			1			(1		)
Income (loss) before taxes on income (loss)	2			57			(45		)	(4		)
(Benefit) provision for taxes on income (loss) ¹	(2		)	17			(18		)	(8		)
Income (loss) from discontinued operations, net of tax	4			40			(27		)	4
Pre-tax gain on sale from discontinued operations	—			—			920			—
Provision for taxes on income	—			—			308			—
Gain on sale of discontinued operations, net of tax	—			—			612			—
Discontinued operations, net	4			40			585			4
Less: net (loss) income attributable to noncontrolling interests	—			(1		)	1			—
Income from discontinued operations attributable to McGraw Hill Financial, Inc. common shareholders	$	4		$	39		$	586		$	4


¹	Benefit for taxes on income for the three months ended June 30, 2013 includes certain adjustments to the discontinued operations provision recorded for the three months ended March 31, 2013.

The components of assets and liabilities classified as held for sale in the consolidated balance sheet consist of the following:



(in millions)	December 31, 2012
Accounts receivable, net	$	333
Property and equipment, net	122
Goodwill	469
Other intangible assets, net	156
Inventories, net	235
Prepublication costs	304
Other assets	321
Assets held for sale	$	1,940

Accounts payable and accrued expenses	$	123
Unearned revenue	192
Other liabilities	349
Liabilities held for sale	$	664

We did not complete any divestitures during the six months ended June 30, 2012.