S&P Global (SPGI) 8-K/A Financial Statements and Exhibits

Exhibit 99.3

UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL INFORMATION

Introduction

On February 28, 2022, S&P Global (“the Company”) merged with and into IHS Markit, with IHS Markit surviving the merger as a wholly owned subsidiary of S&P Global. Under the terms of the merger agreement, each share of IHS Markit issued and outstanding (other than excluded shares and dissenting shares) was converted into the right to receive 0.2838 fully paid and nonassessable shares of S&P Global common stock (and, if applicable, cash in lieu of fractional shares, without interest), less any applicable withholding taxes. As of February 28, 2022, IHS Markit had approximately 401.0 million shares outstanding.

As a condition of securing regulatory approval for the merger, S&P Global and IHS Markit have agreed to divest of certain of their businesses. S&P Global’s divestitures include CUSIP Global Services, its Leveraged Commentary and Data business and a related family of leveraged loan indices while the IHS Markit’s divestitures include Oil Price Information Services (“OPIS”); Coal, Metals and Mining; and PetroChem Wire businesses and its base chemicals business.

Pro Forma Information

The following unaudited pro forma combined condensed financial information has been prepared to illustrate the estimated effects of the merger and related divestitures. The unaudited pro forma combined condensed balance sheet as of December 31, 2021 is based on the individual historical consolidated balance sheets of S&P Global as of December 31, 2021 and IHS Markit as of November 30, 2021, and has been prepared to reflect the merger, and related divestitures, as if they had occurred on December 31, 2021.

The unaudited pro forma combined condensed statements of income for the year ended December 31, 2021 combine the historical consolidated results of operations of S&P Global for the year ended December 31, 2021 and of IHS Markit for the year ended November 30, 2021, and have been prepared to reflect the merger, and related divestitures, as if they had occurred on January 1, 2021, the first day of S&P Global’s 2021 fiscal year. The unaudited pro forma combined condensed financial information has been prepared in conformity with U.S. GAAP.

S&P Global will utilize acquisition accounting and will finalize the accounting as soon as practicable within the required measurement period. The estimated acquired assets and assumed liabilities of IHS Markit have been measured based on various preliminary estimates using assumptions that S&P Global believes are reasonable and based on preliminary valuation studies undertaken by IHS Markit. These preliminary estimates and assumptions presented herein are subject to change during the measurement period as S&P Global finalizes its review of the valuations of the tangible assets and liabilities, identifiable intangible assets, assumed equity compensation plans and related income tax impacts in connection with the merger. Differences between these preliminary estimates and the acquisition accounting will occur, and those differences could have a material impact on the accompanying unaudited pro forma combined condensed financial statements and the combined company’s future results of operations and financial position.

Preliminary estimates of revenue, expenses, assets, liabilities, disposal proceeds and the related tax impacts of the divestures are reflected, where practicable, in the unaudited pro forma combined condensed financial information. These preliminary estimates and related assumptions are subject to change as S&P Global and IHS Markit complete their respective sale transactions, in connection with the merger. Differences between these preliminary estimates and the actual disposition accounting will occur, and those differences could have a material impact on the accompanying unaudited pro forma combined condensed financial statements and the combined company’s future results of operations and financial position.

The unaudited pro forma combined condensed financial information has been presented for informational purposes only. The unaudited pro forma combined condensed financial statements do not necessarily reflect what the combined company’s financial condition or results of operations would have been had the merger, and divestitures, occurred on the dates indicated. They also may not be useful in predicting the future financial condition and results of operations of the combined company. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors.

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S&P Global is developing a plan to integrate the operations of IHS Markit after the merger. In connection with that plan, management anticipates that certain non-recurring charges will be incurred in connection with this integration, which will primarily consist of restructuring charges and transaction costs related to the merger, including, among others, financial advisors, legal services, integration advisors, and professional accounting services. Any such charge could affect the future results of the combined company in the period in which such charges are incurred. Accordingly, the unaudited pro forma combined condensed balance sheet as of December 31, 2021 reflects the effects of the transaction costs related to the merger, which are not included in the historical balance sheets of S&P Global and IHS Markit as of December 31, 2021 and November 30, 2021, respectively. The unaudited pro forma combined condensed financial information does not reflect any operating efficiencies and/or cost savings that S&P Global may achieve with respect to the combined company. Further, there may be additional charges related to integration activities resulting from the merger, the timing, nature and amount of which management cannot identify as of the date of this Current Report on Form 8-K, and thus, such charges are not reflected in the unaudited pro forma combined condensed financial information.

The unaudited pro forma combined condensed financial statements have been developed from and should be read in conjunction with the following historical consolidated financial statements and accompanying notes incorporated by reference herein: (i) the historical consolidated financial statements of the Company and the accompanying notes in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and (ii) the historical consolidated financial statements of IHS Markit and the accompanying notes in IHS Markit’s Annual Report on Form 10-K for the year ended November 30, 2021.

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UNAUDITED PRO FORMA COMBINED CONDENSED BALANCE SHEET

As of December 31, 2021

(in millions)							Transaction Accounting Adjustments									Pro Forma Combined S&P Global
	Historical						Conforming Adjustments				Pro Forma Adjustments
	S&P Global			IHS Markit						(a)
ASSETS
Current assets:
Cash and cash equivalents	$	6,497		$	293						$	2,191		(b	)	$	8,981
Restricted cash		8			—												8
Short-term investments		11			—												11
Accounts receivable, net		1,650			907							(19	)	(c	)		2,538
Deferred subscription costs		—			90		$	(90	)								—
Prepaid and other current assets		323			88			90				(34	)	(c	)(d)(i)		467
Assets held for sale		321			457							(778	)	(c	)		—
Total current assets		8,810			1,835			—				1,360					12,005
Property and equipment, net		241			707							(554	)	(e	)		394
Right of use assets		426			250												676
Goodwill		3,506			9,381							23,656		(f	)		36,543
Other intangible assets, net		1,285			3,022							14,183		(g	)		18,490
Deferred income taxes		—			32			(32	)								—
Asset for pension benefit		359			—												359
Equity-method investments		—			1,613			49									1,662
Other non-current assets		399			74			(17	)								456
Total assets	$	15,026		$	16,914		$	—			$	38,645				$	70,585
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	205		$	72						$	—				$	277
Accrued compensation and contributions to retirement plans		607			251							2		(c	)(h)		860
Other accrued expenses		—			512		$	(512	)								—
Income taxes currently payable		90			105												195
Short-term debt		—			747												747
Unearned revenue		2,217			930							(119	)	(c	)(j)		3,028
Operating lease liabilities		—			55			(55	)								—
Other current liabilities		547			—			567									1,114
Liabilities held for sale		149			41							(243	)	(c	)		(53	)
Total current liabilities		3,815			2,713			—				(360	)				6,168
Long-term debt		4,114			3,900							293		(k	)		8,307
Lease liabilities — non-current		492			255												747
Deferred income taxes		147			430							3,231		(c	)(l)		3,808
Pension and other postretirement benefits		262			—												262
Other non-current liabilities		660			114												774
Total liabilities		9,490			7,412			—				3,164					20,066
Redeemable noncontrolling interest		3,429			13												3,442
Equity:
Common stock		294			5							109		(m	)(o)		408
Additional paid-in capital		1,031			8,022							35,907		(m	)(n)(o)		44,960
Retained income		15,017			4,724							(3,797	)	(b	)(c)(o)		15,944
Accumulated other comprehensive (loss) income		(841	)		(128	)						128		(o	)		(841	)
Less: common stock in treasury		(13,469	)		(3,134	)						3,134		(o	)		(13,469	)
Total equity — controlling interests		2,032			9,489							35,481					47,002
Total equity — noncontrolling interests		75			—												75
Total equity		2,107			9,489							35,481					47,077
Total liabilities and equity	$	15,026		$	16,914		$	—			$	38,645				$	70,585

See accompanying notes to the unaudited pro forma combined condensed financial statements.

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UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF INCOME

For the Year Ended December 31, 2021

(in millions, except per share amounts)							Transaction Accounting Adjustments									Pro Forma Combined S&P Global
	Historical						Conforming Adjustments			(a)	Pro Forma Adjustments
	S&P Global			IHS Markit
Revenue	$	8,297		$	4,658						$	(552	)	(p	)	$	12,403
Expenses:
Cost of revenue		—			1,708		$	(1,708	)								—
Operating-related expenses		2,195			—			1,708				(67	)	(q	)		3,836
Selling and general expenses		1,714			1,181			157				153		(r	)		3,205
Depreciation		82			225							(155	)	(s	)		152
Amortization of intangibles		96			362							561		(t	)		1,019
Restructuring and impairment charges		—			31			(31	)								—
Acquisition-related costs		—			126			(126	)								—
Total expenses		4,087			3,633			—				492					8,212
Gain on dispositions		(11	)		—			(534	)								(545	)
Other operating (income) expense		—			(536	)		536									—
Operating profit		4,221			1,561			(2	)			(1,044	)				4,736
Other income, net		(62	)		—			(2	)								(64	)
Interest expense, net		119			219			1				(78	)	(u	)		261
Income before taxes on income		4,164			1,342			(1	)			(966	)				4,539
Provision for taxes on income		901			136			(1	)			(118	)	(v	)		918
Equity in loss of equity-method investees		—			—												—
Net income before net (income) loss attributable to noncontrolling interests		3,263			1,206			—				(848	)				3,621
Less: net (income) loss attributable to noncontrolling interests		(239	)		1												(238	)
Net income	$	3,024		$	1,207		$	—			$	(848	)			$	3,383
Earnings per share attributable to common shareholders:
Net income:
Basic	$	12.56		$	3.03											$	9.56
Diluted	$	12.51		$	3.01											$	9.51
Weighted-average number of common shares outstanding:
Basic		240.8			398.6							(285.5	)	(w	)		353.9
Diluted		241.8			401.3							(283.7	)	(w	)		355.7

See accompanying notes to the unaudited pro forma combined condensed financial statements.

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NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL INFORMATION

1.     Nature of Operations and Basis of Presentation

On February 28, 2022, S&P Global merged with and into IHS Markit, with IHS Markit surviving the merger as a wholly owned subsidiary of S&P Global. At the effective time of the merger, each share of IHS Markit issued and outstanding (other than excluded shares and dissenting shares) was converted into the right to receive 0.2838 fully paid and nonassessable shares of S&P Global common stock (and, if applicable, cash in lieu of fractional shares, without interest), less any applicable withholding taxes.

The preceding unaudited pro forma combined condensed balance sheet as of December 31, 2021 and the unaudited pro forma combined condensed statements of income for the year ended December 31, 2021 were prepared using the acquisition method of accounting and are based on historical consolidated financial statements of S&P Global and IHS Markit. Certain of IHS Markit’s historical amounts have been reclassified to conform to S&P Global’s financial statement presentation, as discussed further in Note 3. The unaudited pro forma combined condensed financial information should be read in conjunction with the historical consolidated financial statements and accompanying notes of S&P Global included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and historical consolidated financial statements and accompanying notes of IHS Markit included in its Annual Report on Form 10-K for the fiscal year ended November 30, 2021. The unaudited pro forma combined condensed balance sheet gives effect to the merger, and related divestitures, as if they had been completed on December 31, 2021. The unaudited pro forma combined condensed statements of income give effect to the merger, and related divestitures, as if they had been completed on January 1, 2021, the first day of S&P Global’s 2021 fiscal year.

As of the date of this filing, S&P Global has not completed the detailed valuation work necessary to finalize the required estimated fair values and estimated lives of IHS Markit’s assets to be acquired and liabilities to be assumed and the related allocation of purchase price required when applying the acquisition method of accounting. Acquisition accounting requires, among other things, that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. Fair value measurements recorded in acquisition accounting are dependent upon certain valuation studies of IHS Markit’s assets and liabilities and other studies that have yet to progress to a stage where there is sufficient information for a definitive measurement. Accordingly, the pro forma adjustments reflect the assets and liabilities of IHS Markit at their preliminary estimated fair values. Differences between these preliminary estimates and the final values in acquisition accounting will occur, and these differences could have a material impact on the accompanying unaudited pro forma combined condensed financial information and the combined company’s future results of operations and financial position. The allocation of the purchase price will be determined after the merger is completed and after completion of an analysis to determine the estimated fair value of IHS Markit’s assets and liabilities and associated tax adjustments.

The merger, divestitures and the related adjustments are described in the accompanying notes to the pro forma combined condensed financial statements.

The unaudited pro forma combined condensed financial statements do not necessarily reflect what the combined company’s financial condition or results of operations would have been had the merger, and related divestitures, occurred on the dates indicated. They also may not be useful in predicting the future financial condition and results of operations of the combined company. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors. In addition, future results may vary significantly from those reflected in such statements due to factors described under “Risk Factors—Merger Risks” in Item 1A. of Part II of S&P Global’s Annual Report on Form 10-K for the year ended December 31, 2021.

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Accounting Periods Presented

IHS Markit’s historical fiscal year ends on November 30 and for purposes of the unaudited pro forma combined condensed financial information, its historical results have been presented along with S&P Global’s December 31 fiscal year end as explained below.

Because S&P Global’s and IHS Markit’s fiscal year ends differ by less than 93 days, the unaudited pro forma combined condensed statement of income for the year ended December 31, 2021 combines the historical consolidated results of S&P Global for the year ended December 31, 2021 and the historical consolidated results of IHS Markit for the year ended November 30, 2021. The unaudited pro forma combined condensed balance sheet combines the historical consolidated balance sheet for S&P Global as of December 31, 2021 and the historical consolidated balance sheet for IHS Markit as of November 30, 2021.

2. Calculation of Merger Consideration and Preliminary Purchase Price Allocation

S&P Global and IHS Markit have determined that S&P Global is the accounting acquirer in the merger, which will be accounted for under the acquisition method of accounting for business combinations in accordance with Accounting Standards Codification Topic 805, Business Combinations. The allocation of the preliminary estimated purchase price with respect to the merger is based upon management’s estimates of and assumptions related to the fair values of assets to be acquired and liabilities to be assumed as of December 31, 2021, using currently available information. Due to the fact that the unaudited pro forma combined condensed financial statements have been prepared based on these preliminary estimates, the final purchase price allocation and the resulting effect on the combined company’s financial position and results of operations may differ materially from the pro forma amounts included herein.

The final purchase price allocation for the merger will be performed as soon as practicable within the required measurement period and adjustments to estimated amounts or recognition of additional assets acquired or liabilities assumed may occur as more detailed analyses are completed and additional information is obtained about the facts and circumstances that existed as of the closing date of the merger.

The preliminary purchase price allocation is subject to change due to several factors, including but not limited to:

• changes in the estimated fair value of IHS Markit’s identifiable assets acquired and liabilities assumed as of the closing date of the merger, which could result from S&P Global’s additional valuation analysis, changes in reserve estimates, discount rates and other factors; and

• “Risk Factors—Merger Risks” in Item 1A. of Part II of S&P Global’s Annual Report on Form 10-K for the year ended December 31, 2021.

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The unaudited pro forma combined condensed financial information reflects aggregate merger consideration of $44.0 billion, as calculated below:

(in millions, except for share and per share data)
Equity Consideration
Number of shares of IHS Markit issued and outstanding as of February 25, 2022*		400,988,207
Exchange ratio		0.2838
Additional shares of S&P Global common stock to be issued as merger consideration		113,800,453
Closing price per share of S&P Global common stock on February 25, 2022*	$	380.89
Equity portion of aggregate consideration*	$	43,345
Equity consideration related to pre-combination share-based compensation awards*		698
Total equity consideration	$	44,043

* Pursuant to business combination accounting rules, the final aggregate consideration is based on the number of IHS Markit shares issued and outstanding (other than IHS Markit shares held in treasury or for which appraisal rights have been perfected pursuant to the Bermuda Companies Act) and the closing price of S&P Global’s common stock as of February 25, 2022 (and cash in lieu of fractional shares and any amount awarded in respect of shares for which appraisal rights have been perfected pursuant to the Bermuda Companies Act, in each case without interest).

The following table summarizes the preliminary estimated fair values of assets acquired and liabilities assumed as if the acquisition occurred on December 31, 2021:

(in millions)	Fair Value
Tangible assets acquired	$	4,641
Intangible assets		17,205
Liabilities assumed (excluding debt)		(5,887	)
Debt		(4,940	)
Noncontrolling interests		(13	)
Net assets acquired (b)		11,006
Merger consideration (a)		44,043
Estimated goodwill (a) - (b)	$	33,037

The following table sets forth the components of the identifiable intangible assets to be acquired and their preliminary estimated useful lives and the pro forma amortization expense for the year ended December 31, 2021:

					Pro Forma Amortization Expense
(in millions)	Fair Value		Useful Lives		Year ended December 31, 2021
Trade Names	$	1,582		5 – 25	$	118
Developed Technology		2,378		7 – 12		220
Customer Relationship		11,742		17 – 37		455
Database/Content Technology		1,503		9 – 15		130
Total Identified Intangible Assets	$	17,205			$	923

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The estimated acquired assets and assumed liabilities of IHS Markit have been measured based on various preliminary estimates using assumptions that S&P Global believes are reasonable and based on preliminary valuation studies undertaken by IHS Markit. These preliminary estimates of fair value and weighted average useful life are subject to change during the measurement period, and the difference could have a material impact on the accompanying unaudited pro forma combined condensed financial statements and the combined company’s future results of operations and financial position. As S&P Global finalizes its review of IHS Markit’s intangible assets, additional insight will be gained that could impact (i) the estimated total value assigned to identifiable intangible assets and (ii) the estimated weighted average useful life of each category of intangible assets. The estimated intangible asset values and their useful lives could be impacted by a variety of factors that may become known to S&P Global only upon access to additional information. These factors include, but are not limited to, historical information obtained from IHS Markit, discussions with management and product roadmaps. Increased knowledge about these and/or other elements could result in a change to the estimated fair value of the identifiable intangible assets and/or to the estimated weighted average useful lives from what S&P Global and IHS Markit have assumed in these unaudited pro forma combined condensed financial statements. The combined effect of any such changes could then also result in a significant increase or decrease to S&P Global’s and IHS Markit’s estimates of associated amortization expense.

3. Pro Forma Adjustments

The pro forma combined condensed financial statements have been adjusted to reflect reclassifications to conform IHS Markit’s and S&P Global’s financial statement presentation, adjustments to historical book values of IHS Markit to their preliminary estimated fair values in accordance with the acquisition method of accounting, the estimated closing price to be paid by S&P Global for the shares of IHS Markit, the assumption of IHS Markit’s debt, estimated direct transaction costs, preliminary estimates for businesses to be divested and the estimated tax impact of pro forma adjustments. As more information becomes available, S&P Global will complete a more detailed review of IHS Markit’s accounting policies. As a result of that review, differences could be identified between the accounting policies of the two companies that, when conformed, could have a material impact on the unaudited pro forma combined condensed financial statements and the combined company’s future results of operations and financial position. These adjustments include the following:

a. The following reclassifications were made as a result of the transaction to conform IHS Markit and S&P Global’s presentation:

Unaudited Pro Forma Combined Condensed Balance Sheet as of December 31, 2021:

• Reclassification for IHS Markit of $90 million from Deferred subscription costs to Prepaid and other current assets;

• Reclassification for IHS Markit of $32 million from Deferred income taxes to Other non-current assets;

• Reclassification for IHS Markit of $512 million and $55 million from Other accrued expenses and Operating lease liabilities, respectively, to Other current liabilities;

• Reclassification for S&P Global of $49 million from Other non-current assets to Equity-method investments;

Unaudited Pro Forma Combined Condensed Statement of Income for the year ended December 31, 2021:

• Reclassification for IHS Markit of $1,708 million from Cost of revenue to Operating-related expenses;

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• Reclassification for IHS Markit of $31 million from Restructuring and impairment charges and $126 million from Acquisition-related costs to Selling and general expenses;

• Reclassification for IHS Markit of $536 million from Other operating (income) expense to Gain on dispositions and Other income, net for $534 million and $2 million, respectively.

• Reclassification for IHS Markit of $1 million from Provision on income taxes on income to Interest expense, net.

Pro Forma Adjustments – Combined Condensed Balance Sheet as of December 31, 2021:

b. To record the following adjustments to cash and cash equivalents:

• $93 million charge for the impact of transaction costs directly attributable to the merger (which have not been incurred as of December 31, 2021) and the corresponding adjustment to retained income for the amounts assumed to be paid as of the transaction date.

• $2,284 million of after-tax proceeds related to the OPIS divestiture, the Base Chemical divestiture, the Root Metrics divestiture and the CUSIP divestiture, in aggregate. Estimates of proceeds associated with other divestitures of S&P Global businesses, which are expected to be completed in connection with the close of the merger between S&P Global and IHS Markit, are not reflected in the combined condensed pro forma balance sheet as there are no contracts to sell such businesses to date.

c. To record adjustments to remove the carrying value of certain assets and liabilities related to divestitures expected to be completed in connection with the close of the merger between S&P Global and IHS Markit.

d. To record the adjustment to remove IHS Markit’s historical deferred commission costs of $39 million that are part of the value attributed to acquired customer relationships that will be included among the identified intangible assets described in adjustment 3(g) below establishing identified intangible assets acquired as part of the purchase price allocation.

e. To record the adjustment to remove IHS Markit’s carrying value of capitalized software of $554 million that will be remeasured and characterized as acquired developed technology that will be included among the identified intangible assets described in adjustment 3(g) below establishing identified intangible assets acquired as part of the purchase price allocation.

f. To record the adjustment to remove IHS Markit’s historical goodwill of $9.4 billion and record goodwill associated with the combination of $33 billion estimated as a result of the preliminary purchase price allocation described in Note 2. The adjustment to goodwill also reflects an adjustment to remove preliminary estimates of goodwill associated with expected divestitures of S&P Global businesses.

g. To record the adjustment to remove IHS Markit’s historical intangible assets of $3.0 billion and record intangible assets associated with the combination of $17.2 billion estimated as a result of the preliminary purchase price allocation described in Note 2.

h. To record an accrual of $3 million for the estimated unpaid portion of the S&P Global non-recurring retention bonuses attributable to the merger agreement.

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i. To record an increase to the income taxes currently receivable of $4 million related to non-recurring transaction costs and retention payments.

j. To adjust IHS Markit’s deferred revenue to a preliminary fair value of $811 million.

k. To record the fair value adjustment to increase IHS Markit’s debt by $293 million.

l. To record an increase to deferred tax liabilities based on the blended foreign, federal and state statutory rate of approximately 26% multiplied by the fair value adjustments related to the assets acquired and liabilities assumed. These adjustments are based on estimates of the fair value of IHS Markit’s assets to be acquired, liabilities to be assumed, and the related purchase price allocations. These estimates are subject to further review by S&P Global’s and IHS Markit’s respective managements, which may result in material adjustments to deferred taxes with an offsetting adjustment to goodwill.

The constituent parts of the adjustment for net deferred tax liabilities are as follows:

(in millions)
Record net deferred tax liabilities for:
Fair market value adjustment increasing IHS Markit intangibles	$	3,662
Fair market value adjustment decreasing IHS Markit capitalized software		(135	)
Fair market value adjustment decreasing IHS Markit deferred commission costs		(7	)
Fair market value adjustment decreasing IHS Markit deferred revenue		24
Fair market value adjustment increasing IHS Markit debt		(71	)
Removal of IHS Markit’s existing deferred tax liability for goodwill		(189	)
Total net deferred tax adjustment	$	3,284

m. To reflect the $1.00 par value of S&P Global common stock issued in exchange for each share of IHS Markit issued and outstanding resulting in an increase to common stock of $114 million.

n. To record the estimated increase in additional paid-in capital of $44.0 billion for the merger consideration.

o. To record the elimination of IHS Markit’s historical equity balances to arrive at an unaudited pro forma combined condensed balance sheet.

Pro Forma Adjustments – Combined Statements of Income for the year ended December 31, 2021:

p. To record adjustments to revenue of $552 million for the year ended December 31, 2021 to reflect:

• the removal of revenue associated with the expected divestitures of $463 million for the year ended December 31, 2021.

• a reduction of revenue of $89 million, for the year ended December 31, 2021, related to the estimated fair value of the acquired deferred revenue. The fair value of acquired deferred revenues has been adjusted to reflect a value equal to the costs to fulfill the performance obligation plus an appropriate profit margin. The historical carrying amounts of IHS Markit’s deferred revenues results in a discount to the recorded deferred revenue that will be subsequently recognized as a reduction to revenues.

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q. To record adjustments to operating-related expenses of $67 million for the year ended December 31, 2021 to reflect:

• the removal of direct operating expenses of $100 million for the year ended December 31, 2021 related to the expected divestitures.

• the incremental estimated stock-based compensation expense related to the unvested portion of IHS Markit’s RSUs and PSUs of $33 million for the year ended December 31, 2021 reflecting the increase in value as if the transaction occurred as of January 1, 2021 reflecting the current stock price and the performance targets of the awards pursuant to the merger agreement.

r. To record adjustments to selling and general expenses of $153 million for the year ended December 31, 2021 to reflect:

• the removal of direct selling and general expenses of $81 million for the year ended December 31, 2021 related to the expected divestitures.

• the incremental estimated stock-based compensation expense of $72 million for the year ended December 31, 2021 related to the unvested portion of IHS Markit’s RSUs and PSUs, reflecting the increase in value as if the transaction occurred as of January 1, 2021 reflecting the current stock price and the performance targets of the awards pursuant to the merger agreement.

• S&P Global and IHS Markit non-recurring retention bonuses of $80 million for the year ended December 31, 2021, which are directly attributable to the merger agreement. Severance and other integration related restructuring costs have not been reflected in these unaudited pro forma combined condensed financial statements given the preliminary nature of these anticipated actions.

• the reduction to the deferred commission expense for IHS Markit of $11 million for the year ended December 31, 2021 reflecting the revaluation of the customer acquisition costs.

• the cost of acquisition-related transaction costs by S&P Global and IHS Markit which have been incurred or expected to be incurred but not yet recognized of $93 million for the year ended December 31, 2021.

s. To record the reduction in depreciation expense related to (i) the removal of depreciation expense associated with expected divestitures and (ii) the elimination of capitalized software.

t. To eliminate the historical amortization expense (including amortization expense associated with expected divestitures) and to record the estimated amortization expense related to the intangible assets to be acquired.

u. To record the adjustment to interest expense associated with the increase in IHS Markit’s debt to fair value with which this premium is amortized over the weighted-average remaining life of the debt.

v. To record the income tax expense reduction of $155 million related to the pro forma adjustments for the year ended December 31, 2021, calculated based on a blended foreign, federal, and state statutory rate of approximately 25%. Also, to reflect additional tax costs associated with IHS Markit’s operations within the S&P Global structure of approximately $102 million for the year ended December 31, 2021. Finally, to record the income tax expense reduction of $65 million related to the expected divestitures for the year ended December 31, 2021. The effective tax rate of the combined company could be significantly different than what is presented in these unaudited pro forma combined condensed financial statements depending on post-acquisition activities, including legal entity restructuring, repatriation decisions, and the geographical mix of taxable income.

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w. To reflect (i) the elimination of IHS Markit’s basic and diluted shares outstanding and (ii) the assumed issuance of basic and diluted common shares as a result of the merger calculated by multiplying IHS Markit’s basic and diluted common shares outstanding by the 0.2838 exchange ratio.

	Year ended December 31, 2021
(in millions, except for share and per share data)	Basic Shares Outstanding			Diluted Shares Outstanding
Weighted-average outstanding
S&P Global weighted-average outstanding		240.8			240.8
IHS Markit weighted-average outstanding		398.6			398.6
Combined weighted-average outstanding		639.4			639.4
Elimination of IHS Markit’s historical weighted average-outstanding		(398.6	)		(398.6	)
Record new issuance of S&P Global common stock at 0.2838 exchange ratio		113.1			113.1
S&P Global diluted securities		N/A			1.0
IHS Markit diluted securities converted at 0.2838 exchange ratio		N/A			0.8
Net pro forma adjustments		(285.5	)		(283.7	)
Pro forma combined weighted-average outstanding		353.9			355.7
Pro forma net income	$	3,383		$	3,383
Pro forma earnings per share	$	9.56		$	9.51

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