Morningstar plans to acquire commentary and leveraged data

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LCD will complement PitchBook’s strong product and research capabilities by covering all leveraged loan market metrics

CHICAGO and SEATTLE, April 4, 2022 /PRNewswire/ — Morningstar Inc., a leading provider of independent investment research (Nasdaq: MORN), has reached an agreement to acquire Leveraged Commentary & Data (LCD), a market leader in news, research, data, information and indices for the leveraged finance market from S&P Global. The purchase price is up to $650 million in cash, consisting of $600 million at closing, subject to certain adjustments, and a contingent payment of up to $50 million six months after closing, the fulfillment of certain conditions related to the transition of LCD customer relationships.

LCD is the industry standard for leveraged loan data, news, analysis and indices, providing coverage throughout the loan lifecycle. The leveraged loan market data provider will integrate with Morningstar’s PitchBook platform, which provides data, research and technology spanning the breadth of private and public capital markets. This unique data set combined with PitchBook’s already strong data, information and technology will create a centralized platform for participants in the leveraged finance market.

“As alternative asset markets continue to grow and deepen, this acquisition provides new opportunities for PitchBook and LCD to jointly solve real customer problems and address the need for transparency in private credit markets,” said declared John Gabbert, founder and CEO of PitchBook. “LCD’s in-depth coverage of the leveraged loan market combined with institutional-level coverage of PitchBook’s private and public equity markets will create an end-to-end data and research tool to enable basic workflows There is nothing else with more complete access to this data in one place.”

The acquisition of LCD will complement PitchBook’s strong product and research capabilities and provide coverage of all leveraged loan market metrics, including structure, pricing, yield, volume, as well as secondary market performance and LBO/private equity activity. LCD is the only provider of real-time coverage of the US and European leveraged loan and high yield bond markets, from trade inception through debt life. It also provides growing coverage of investment grade bond issuances, distressed debt, corporate bankruptcies, middle market transactions and CLOs/fundraisings. In 20 years, LCD has provided data on over 30,000 issuers and 85,000 transactions.

LCD has over 500 leveraged loan indices in the United States and Europe tracking performance, index characteristics and compound risk metrics of over 1,800 loans. The S&P/LSTA Leveraged Loan Index, the flagship benchmark for this asset class, and related indices will be part of the growing fixed income capabilities of Morningstar Indexes, one of fastest growing global index providers.

When the deal closes, more than 60 LCD employees, including senior journalists, researchers, technologists, and customer support and sales personnel, will join Morningstar as part of the PitchBook team. LCD’s existing management team will join and continue to drive the company’s future plans.

LCD generates approx. $56 million In income. Morningstar intends to fund the transaction with a combination of cash on hand and a new credit facility at closing. The transaction is expected to be accretive to adjusted net earnings per share, which excludes mergers and acquisitions-related amortization and integration costs, in the first year after closing. The Company also expects to receive a tax benefit due to an increase in the tax base and related future deductions in connection with the transaction. The transaction is expected to close in early Q3 2022, subject to customary closing conditions.

About PitchBook
PitchBook is a financial data and software company that provides capital markets transparency to help professionals discover and execute opportunities with confidence and efficiency. PitchBook collects and analyzes detailed data on the entire venture capital, private equity, and M&A landscape, including public and private companies, investors, funds, investments, exits, and people . Company data and analysis is available through the PitchBook platform, industry news and in-depth reports. Founded in 2007, PitchBook has offices in Seattle, San Francisco, new York, Londonand hong kong and serves more than 70,000 professionals worldwide. In 2016, Morningstar acquired PitchBook, which now operates as a subsidiary.

About Morningstar, Inc.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australiaand Asia. The Company offers a broad range of products and services to individual investors, financial advisors, asset managers and owners, pension plan providers and sponsors, and institutional investors in the private debt and capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly traded companies, private capital markets, debt securities and market data world in real time. Morningstar also offers investment management services through its investment advisory subsidiaries, with approximately $265 billion in assets under advisory and management worldwide. December 31, 2021. The Company operates in 29 countries. For more information, visit www.morningstar.com/company. Follow Morningstar on Twitter @MorningstarInc.

Caution Regarding Forward-Looking Statements
This press release contains forward-looking statements as that term is used in the Private Securities Litigation Reform Act of 1995. These statements are based on our current expectations regarding future events or future financial performance. Forward-looking statements, by their nature, address matters that are, to varying degrees, uncertain and often contain words such as “project”, “outlook”, “may”, “could”, “expect”. , “intend”, “plan”. ,” “seek”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “continue”, “stay”, “target” or “will”, and similar references to future periods. Miscellaneous risks and uncertainties may cause actual results to differ materially from those indicated, projected or implied by the forward-looking statements, including (i) future demand for news, research, data, information and indices for the leveraged finance market; (ii) any delay in (a) the expiration or termination of any waiting period required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 or (b) receipt of European Commission approval of Morningstar as an acceptable acquirer of LCD; (iii) the risks and costs associated with integrating, and Morningstar’s ability to successfully integrate LCD and (iv) failure to obtain the financing necessary to complete the transaction. urs that will influence the impact on our business and operations include, but are not limited to, the risks and uncertainties affecting Morningstar that are described in our filings with the Securities and Exchange Commission, including our most recent annual report on form 10-K. If any of these risks and uncertainties materialize, our actual future results and other future events could differ materially from our expectations. We do not undertake to update our forward-looking statements as a result of new information or future events.

©2022 Morningstar, Inc. All rights reserved.

Media Contact:
Stephanie Lerdall+1 312 244-7805 or [email protected]

SOURCEMorningstar, Inc.

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