In November of 2016, we entered into a put option agreement that gave the Company the right, but not the obligation, to put the entire share capital of Quant House SAS (“QuantHouse”), included in our Market and Commodities Intelligence seg- ment, to QH Holdco, an independent third party. As a result, we classified the assets and liabilities of QuantHouse, net of our costs to sell, as held for sale in our consolidated balance sheet as of December 31, 2016 resulting in an aggregate loss of $31 million. On January 4, 2017, we exercised the put option,
thereby entering into a definitive agreement to sell QuantHouse to QH Holdco. On January 9, 2017, we completed the sale of QuantHouse to QH Holdco.
2016
During the year ended December 31, 2016, we completed the following dispositions that resulted in a net pre-tax gain of $1.1 billion, which was included in (gain) loss on dispositions in the consolidated statement of income:
In October of 2016, we completed the sale of Equity and Fund Research (“Equity Research”), a business within our Market and Commodities Intelligence segment to CFRA, a lead- ing independent provider of forensic accounting research, analytics and advisory services. During the year ended December 31, 2016, we recorded a pre-tax gain of $9 million ($5 million after-tax) in (gain) loss on dispositions in the con- solidated statement of income related to the sale of Equity Research.
In October of 2016, we completed the sale of Standard & Poor’s Securities Evaluations, Inc. (“SPSE”) and Credit Market Analysis (“CMA”), two businesses within our Market and Commodities Intelligence segment, for $425 million in cash to Intercontinental Exchange, an operator of global exchanges, clearing houses and data services. During the year ended December 31, 2016, we recorded a pre-tax gain of $364 million ($297 million after-tax) in (gain) loss on dis- positions in the consolidated statement of income related to the sale of SPSE and CMA.
In September of 2016, we completed the sale of J.D. Power, included within our Market and Commodities Intelligence segment, for $1.1 billion to XIO Group, a global alternative investments firm headquartered in London. During the year ended December 31, 2016, we recorded a pre-tax gain of $728 million ($516 million after-tax) in (gain) loss on disposi- tions in the consolidated statement of income related to the sale of J.D. Power. Following the sale, the assets and liabili- ties of J.D. Power are no longer reported in our consolidated balance sheet as of December 31, 2016.
2015
During the year ended December 31, 2015, we recorded a pre-tax gain of $11 million in (gain) loss on dispositions in the consolidated statement of income related to the sale of our interest in a legacy McGraw Hill Construction investment. In the fourth quarter of 2015, we began exploring strategic alternatives for J.D. Power, included within our Market and
Commodities Intelligence segment, and initiated an active program to sell the business. The assets and liabilities of J.D. Power were classified as held for sale in our consolidated bal- ance sheet as of December 31, 2015.
2014
During the year ended December 31, 2014, we completed the following dispositions that resulted in a net pre-tax loss of $9 million, which was included in (gain) loss on dispositions in the consolidated statement of income:
On July 31, 2014, we completed the sale of the Company’s aircraft to Harold W. McGraw III, then Chairman of the Company’s Board of Directors and former President and CEO of the Company for a purchase price of $20 million. During the second quarter of 2014, we recorded a non-cash impair- ment charge of $6 million in (gain) loss on dispositions in our consolidated statement of income as a result of the pending sale. See Note 14 — Related Party Transactions for further information.
On June 30, 2014, we completed the sale of our data center to Quality Technology Services, LLC which owns, operates and manages data centers. Net proceeds from the sale of $58 million were received in July of 2014. The sale included all of the facilities and equipment on the south campus of our East Windsor, New Jersey location, inclusive of the rights and obligations associated with an adjoining solar power field. The sale resulted in an expense of $3 million recorded in (gain) loss on dispositions in our consolidated statement of income, which is in addition to the non-cash impairment charge we recorded in the fourth quarter of 2013.
The components of assets and liabilities held for sale in the consolidated balance sheet consist of the following:
(in millions) December 31, 20161
December 31, 20152
Accounts receivable, net $ 4 $ 58 Goodwill — 75 Other intangible assets, net — 335 Other assets 3 35 Assets of a business held for sale $ 7 $ 503 Accounts payable and accrued
expenses $ 3 $ 42 Unearned revenue 7 64 Other liabilities 35 100
Liabilities of a business held for
sale $ 45 $ 206
1 Assets and liabilities held for sale as of December 31, 2016 relate to QuantHouse.
The operating profit of our businesses that were disposed of or held for sale for the years ending December 31, 2016, 2015, and 2014 is as follows:
Year ended December 31,
(in millions) 2016 2015 2014
Operating profit 1 $62 $85 $71
1 The year ended December 31, 2016 excludes a pre-tax gain of $1.1 billion on our dispositions.