Students could be out of pocket under proposed US merger

McGraw-Hill’s takeover of rival publisher Cengage could lead to increased university textbook prices

The Competition and Markets Authority (CMA) is investigating a proposed merger between two leading US-based publishers of university textbooks.

McGraw-Hill’s takeover of rival publisher Cengage could, said the UK competition watchdog, lead to increased university textbook prices that would leave students worse off.

The CMA first announced its merger inquiry on 14 January. During its subsequent phase 1 investigation, the CMA looked at where McGraw-Hill and Cengage overlap, finding 379 courses where both companies offered textbooks.

It identified 51 courses where McGraw-Hill and Cengage would have high combined market shares – in some cases over 80% – or where there would otherwise be very little competition if the two publishers merged.

McGraw-Hill and Cengage have now been invited to address the CMA’s concerns by 17 March. If they are unable to, the merger will be referred for a more detailed, phase 2 investigation.

Record numbers of people are looking to go to university with more than 700,000 applying in 2019. This reinforces just how important it is that we look at this deal

Both publishers are headquartered in the United States but trade internationally. In scrutinising the proposed merger, the UK government regulator has worked closely with the US Department of Justice and the Australian and New Zealand competition agencies .

“Record numbers of people are looking to go to university with more than 700,000 applying in 2019. This reinforces just how important it is that we look at this deal,” said Joel Bamford, senior director of mergers at the CMA.

“This proposed merger would bring together two important suppliers in the UK and could lead to students paying more for essential textbooks and educational materials.”

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