The breakup of the mini-conglomerate follows public demands starting in July from the Ontario Teacher's Pension Fund and hedge fund Jana Partners LLC for a broad reorganization. The activists suggested breaking up the company into more than two pieces to highlight the value of its individual equities, commodities and financial analytics units.These activist investors comprise about a 15% (so far) stake in the company. McGraw-Hill, in case you didn't know, is a major publisher of "integrated math" and "Everyday Math" books.
Activist investing is an interesting strategy in educational reform; in this case it appears to be the unlikely alliance of teachers (with educational interests) and a hedge fund (with a financial interest). Even with a small, but significant stake, you can nucleate other shareholders around you and force management votes and proxy battles, and cause massive headaches for management, who will often have a large risk of being voted out.
Even if voting out does not occur, management will often make such concessions to activists as reform of their company policies and educational products, or even various monetary "greenmails"; activists can then use this money to multiply their leverage against other targeted companies.