McGraw Hill made its return to public markets on Thursday, opening at $17 per share — the same as its IPO price — and landing a valuation of $3.25 billion. The flat debut signaled a lukewarm investor response despite an otherwise optimistic environment for new listings.
While IPO activity has surged after a slump earlier this year due to tariff-related uncertainty, investors remain cautious and highly selective.
“As a resilient company, all of those macro factors are really interesting to see, but they have no bearing on our company. We know the time is right for us now,” said McGraw Hill CEO Simon Allen.
Other recent IPOs have seen mixed results. Shares of Advent-backed NIQ Global dipped 3.6% during its NYSE debut on Wednesday, while many companies continue to stay private to avoid volatile market conditions. In contrast, digital bank Chime and stablecoin issuer Circle enjoyed strong market debuts this week.
McGraw Hill, backed by Platinum Equity, priced its IPO below its original $19 to $22 range, raising $414.63 million by selling 24.39 million shares.
Originally spun off from McGraw-Hill Companies in 2013 and sold to Apollo Global Management for $2.5 billion, McGraw-Hill Education was later acquired by billionaire Tom Gores’ Platinum Equity in a $4.5 billion deal in 2021. Apollo made an attempt to take McGraw public in 2015, but the effort was ultimately abandoned.
According to company filings, McGraw Hill remains a dominant name in the education publishing sector, with its products used by 99% of U.S. public K-12 districts and 82% of U.S. higher education institutions.
“We expect the debut to be tepid initially,” said IPOX Schuster analyst Kat Liu. “There’s long-term potential, but like other sponsor-backed names, it may take time to build real momentum and shake off the overhang of private equity influence.”
McGraw Hill plans to use the proceeds from the IPO to pay down debt from Platinum Equity’s $4.5 billion acquisition of the company from Apollo Global Management in 2021.
The IPO values McGraw Hill with an enterprise worth approximately $5.7 billion.
Platinum Equity, which did not sell shares in the offering but contributed stock to the greenshoe option, saw its ownership stake diluted to 84.6%. Although the firm achieved a premium valuation compared to its purchase price, it will need to sell some of the 161.5 million McGraw Hill shares it still holds to realize a cash profit.
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