News Corp is to acquire the Oil Price Information Service (OPIS) and related assets from S&P Global and IHS Markit.
News Corp is acquiring OPIS for $1.15 billion in a cash transaction, subject to customary adjustments, and also expects to receive an estimated tax benefit of $180 million as part of the transaction. S&P Global and IHS Markit announced in May their exploration of the divestiture of the businesses to ensure a timely merger of both companies. News Corp’s acquisition of OPIS is subject to customary closing conditions, including regulatory approvals and the consummation of the S&P Global and IHS Markit merger, which is expected in the fourth quarter of this calendar year. OPIS will become part of Dow Jones’ Professional Information Business (PIB), which includes Dow Jones Risk & Compliance, Dow Jones Newswires and Factiva. OPIS has a revenue base that is nearly 100% digital, 95% recurring and operates at approximately 50+% Adjusted EBITDA margins.
Founded in 1977, OPIS today is a global industry standard for benchmark and reference pricing and news and analytics for the oil, natural gas liquids and biofuels industries, and a growing provider of insights and analytics in renewables and carbon pricing. At its core, OPIS provides end-to-end pricing and analytics information to the energy industry from the refinery to the retailer.
“OPIS will be the cornerstone for a rising commodities, energy and renewables digital business that we are convinced will have a positive impact on Dow Jones and News Corp,” said Robert Thomson, Chief Executive of News Corp. “We certainly believe OPIS and Dow Jones will be more than the sum of their valuable parts. Dow Jones is ideally positioned to accelerate growth at OPIS, while OPIS will be a powerful pillar, alongside Risk & Compliance, in the fast-growing Dow Jones Professional Information Business.”
OPIS and related assets revenues have grown at an approximate 10% CAGR, including acquisitions, since 2016, as disclosed by IHS Markit, and grew at a consistent rate through the 2008-2009 global financial crisis, the 2014-2015 oil market downturn and the current pandemic. In its current fiscal year (ending November 30, 2021), OPIS is expected to generate approximately $129 million in revenues, Adjusted EBITDA margins exceeding 50%.In its fiscal year ended November 30, 2020, OPIS generated revenue and Adjusted EBITDA of approximately $121 million and $61 million, respectively.
OPIS, headquartered in Rockville, Maryland, also has offices in Mexico, the United Kingdom, France, Romania and Singapore. The company employs approximately 400 professionals globally.
News Corp will report its full year 2021 results on August 5, 2021.
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