At the same time the company is grappling with the cost and uncertainty of changing over from paper to digital delivery of its content, which is affecting the college textbook market as well, Huber said. The education company’s elementary and high school revenue have been falling with spending cutbacks by state and local governments for textbooks. New York-based McGraw-Hill is the second-largest educational publisher in the world, selling texts for elementary and high school students, as well as to university students and professionals. McGraw-Hill shares, which often move with the outlook for new bond issues that will be rated by its Standard & Poor’s unit, are up about 15 percent this year. McGraw-Hill stock closed up 0.4 percent at $51.89, while Apollo shares slipped 0.4 percent to $15.27.

“Investors should be happy with $2.5 billion,” said independent analyst Craig Huber of Huber Research Partners in Greenwich, Connecticut. McGraw-Hill expects to record a non-cash impairment charge of about $450 million to $550 million in the fourth quarter to mark down the value of the educational unit. The price, while less than the $3 billion McGraw-Hill had hoped for earlier, was fair given recent strains on the business and the uncertainty of evolving digital publishing formats, analysts said. Private equity firm Apollo Global Management LLC will buy McGraw-Hill’s educational publishing unit for $2.5 billion, McGraw-Hill said on Monday.

A woman walks past the entrance to offices of the McGraw-Hill Companies, in New York August 15, 2008.

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