McGraw-Hill (NYSE: MHP) and CME Group (NASDAQ: CME) announced today an agreement to establish a joint venture in the rapidly growing index business.  Both companies will contribute complementary S&P Indices and Dow Jones Indexes businesses into a joint venture.  S&P/Dow Jones Indices will be a leading global index company providing new products to clients and generating growth for shareholders of both companies.

McGraw-Hill will own 73% of S&P/Dow Jones Indices, CME Group will own 24.4% through its affiliates and Dow Jones will own 2.6%.  S&P/Dow Jones Indices is expected to be operational in the first half of 2012, subject to regulatory approval and customary closing conditions.  The joint venture company will be become part of the new McGraw-Hill Markets company.

The deal is expected to be accretive immediately after closing.  The joint venture will start out with a revenue base of US$ 400 million with US$ 80 million being contributed from CME.

Source: McGraw-Hill Press Release