Fitch Rates McGraw-Hill's Commercial Paper Program 'F1'

Business Wire, June 25, 2007

NEW YORK -- Fitch Ratings has assigned an 'F1' rating to the 4(2) commercial paper (CP) program of The McGraw-Hill Companies, Inc (McGraw-Hill). The new program replaces McGraw-Hill's prior CP program.

Fitch rates the following for McGraw-Hill Companies, Inc.:

-- Long-Term Issuer Default Rating (IDR) 'A ';

-- Short Term IDR 'F1';

-- Senior Unsecured 'A ';

-- Commercial paper 'F1'.

The Rating Outlook is Stable.

The CP rating of 'F1' considers McGraw-Hill's solid financial flexibility and liquidity consisting of cash and cash equivalents of $430 million (as of March 31, 2007) and a $1.2 billion revolving credit facility expiring 2009 that supports the CP program. In addition, the ratings reflect the company's significant cash flow generating ability, its sound balance sheet, the diversity and growth prospects of its products and services and its prominent business franchises.

Rating concerns include the threat of a rising interest rate environment and a potential slowdown in structured finance rating fee revenues. Also, the rating incorporates the risk of enhanced regulatory oversight and legislation on credit rating agencies globally. In addition, Fitch's rating reflects the volatility of new state adoptions in the Educational Publishing market as demonstrated by the expected reacceleration of new adoption activity in 2007-2009 following a slower 2006. The ratings incorporate McGraw-Hill's exposure, mainly through its Information & Media division, to the cyclical advertising trends and secular challenges faced by traditional media. The Stable Outlook recognizes McGraw-Hill's capacity to make financially prudent acquisitions and return capital to shareholders given the significant financial flexibility, solid operating performance and future growth prospects at all three divisions.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.