CORRECTED-McGraw-Hill approves special dividend in lieu of buybacks

Thu Dec 6, 2012 5:12pm EST

(Corrects date of regular dividend payment to Dec. 12 from Dec. 15)

Dec 6 (Reuters) - McGraw-Hill Companies Inc said it will pay a special dividend of $2.50 a share before year-end and will drop its previously announced plan to buy back up to $200 million more of stock this year.

The announcement on Thursday follows the company's decision last week to sell its education publishing business to Apollo Global Management for $2.5 billion. McGraw-Hill expects to receive $1.9 billion in after-tax proceeds from that sale

The company said it is paying the special dividend as part of the plan it announced last year to boost shareholder value.

McGraw-Hill had 278 million shares of stock outstanding as of Oct. 15.

The special dividend will be payable on Dec. 27 to shareholders of record on Dec. 18, the company said. It will be in addition to the company's regular quarterly dividend to be paid on Dec. 12.

(Reporting by David Henry in New York; Editing by Leslie Gevirtz)

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