McGraw-Hill acquires local J.D. Power and Associates

McGraw-Hill acquires local J.D. Power and Associates

By Sylvie Belmond

belmond@theacorn.com

The McGraw-Hill Companies agreed last week to buy J.D. Power and Associates, a global information services company based in Thousand Oaks. The move is expected to preserve J.D. Power’s identity and facilitate future growth.

The transaction, subject to regulatory review, is expected to conclude in April. Terms were not disclosed.

"The acquisition is clearly a growth acquisition, there are no planned layoffs or office closures, said Pete Marlow, partner and head of corporate communications for J.D. Power.

McGraw-Hill manages independent brands and intends to preserve the unique identity of J.D. Power, Marlow said.

"They were adamant that they were investing in the people and strategies and had no plans to disrupt that or do anything that would affect independence and integrity of the company," he said.

J.D. Power, formerly based in Agoura Hills, wants to double its size in the next four years and needs an outside investment partner to sustain the initial growing costs, Marlow explained.

David Power founded the local company in 1968. He began by sending out customer surveys from his kitchen table with the help of his wife, Julie, and his children. The family attached a quarter to the questionnaire to elicit responses.

Almost four decades later, J.D. Power is the leading provider of marketing information services for the automotive industry.

The company employs 376 people in Thousand Oaks. But growth has always been a priority, and the acquisition will enable the company to expand into other industries such as healthcare, telecommunications, homebuilding, and the energy business, Marlow said.

McGraw-Hill was founded in 1988. As a leading global information services provider for the financial, education and business information markets, it has built brands such as Standard & Poor’s, BusinessWeek and McGraw-Hill Education.

The McGraw-Hill Corporation has more than 280 offices in 37 countries. Sales in 2004 were $5.3 billion. J.D. Power has 12 offices worldwide; five are in the U.S.

"David Power felt this was an excellent match. They have the experience managing independent brands," Marlow said.

J.D. Power and Associates provides an independent source of marketing information to consumers and businesses. The company also has xestablished a presence in other industries including finance and insurance, healthcare, home building, telecommunications and energy.

The two companies will be an excellent fit, said Harold McGraw III, McGraw-Hill chairman, president and CEO. "It will enhance our growth prospects for our business information platforms," McGraw said.

J.D. Power will benefit from McGraw-Hill’s broad global presence and detailed knowledge of major industries, including financial services, construction, energy, aviation and healthcare, McGraw added.

"In The McGraw-Hill Companies, we have found an ideal partner that will provide our firm with the best opportunity to extend J.D. Power and Associates’ reach globally and into new vertical markets," said David Power.

"I am personally delighted to have found a partner that shares our heritage of integrity and independence, and our unyielding commitment to providing objective research and analysis," Power said.

"There will be a smooth transition for our customers and employees, and we look forward to working closely with our new colleagues on a host of exciting growth opportunities."