Filing Flows › Borgwarner (BWA) › Takeover & LBO
Is Borgwarner (BWA) a takeover target?
A leveraged buyout at today's price plus 30% ($61.79 a share) would return a loss of about 3% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $35.97 a share (−24% against today's $47.53). Historically 4.5% of companies with its figures were bought within a year (0.9× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $61.79 | today's $47.53 plus 30% |
| × shares | 204.6 million | |
| = Equity value | $12.6B | |
| + Debt refinanced | $3.0B | |
| − Cash | $1.6B | |
| + Other claims | $195M | preferred stock, minority interests |
| = Enterprise value | $14.3B | 10.3× EBITDA of $1.4B |
| Fees | $285M | 2% of the price |
| New debt | $7.6B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $6.9B | 48% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $14.3B | $1.4B | $582M | $217M | $7.4B |
| Year 2 | $14.4B | $1.4B | $565M | $227M | $7.2B |
| Year 3 | $14.7B | $1.4B | $548M | $240M | $6.9B |
| Year 4 | $15.0B | $1.5B | $530M | $259M | $6.7B |
| Year 5 | $15.5B | $1.5B | $510M | $282M | $6.4B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 8.2× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $12.3B | |
| − Debt left | $6.4B | |
| = Buyer's equity | $6.0B | |
| Money multiple | 0.86× | on $6.9B put in |
| Buyer's yearly return (IRR) | −3.0% |
Price against return
What the buyer makes at other premiums over today's $47.53; the IRR reaches 20% at $35.97 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $52.28 | 3.8% |
| 20% | $57.04 | 0.0% |
| 30% | $61.79 | −3.0% |
| 40% | $66.54 | −5.6% |
| 50% | $71.30 | −7.8% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $14.2B | |
| EBITDA, last 12 months | $1.4B | 9.7% of revenue |
| Depreciation and amortization | $613M | |
| Capital spending | $526M | |
| Debt | $3.0B | |
| Cash | $1.6B | |
| Share price | $47.53 | on Nov 6, 2026 |
Fixed rules, the same as the interactive view's starting point: the shares are bought at today's price plus 30%, the company's debt is refinanced and fees take 2%. New debt is the least of 5.5× EBITDA, 65% of the price and the amount whose interest EBITDA covers 2 times, at 7.65% a year (SOFR 3.89% plus the high-yield B spread 3.26% plus 0.5%, rates of Oct 15, 2026). Revenue grows 0.4% in the first year — the company's own rate, held between −3% and +8% — fading to 3% by year 5; the EBITDA margin, depreciation and capital spending stay at today's share of revenue; working capital takes 10% of each year's added revenue; tax is 29% of profit after interest. Every dollar of free cash flow repays debt. After 5 years the buyer sells at today's multiple of EBITDA.
What a takeover could cost
Takeovers on record paid a median premium of 32.5% over the share price before the deal (the middle half 20% to 51.8%), according to the 1,437 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Borgwarner would cost about $62.98 a share, $12.9B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 20% | $57.04 | $11.7B |
| Median | 32.5% | $62.98 | $12.9B |
| High end (a quarter paid more) | 51.8% | $72.15 | $14.8B |
The odds, from history
Historically 4.5% of companies with its figures were bought within a year (0.9× the average). Its figures put it in decile 5 of 10 (10 = the most likely to be bought). The odds come from a model of every merger proxy, tender-offer response and going-private statement filed on EDGAR since 2011, set against each company's size, margins, debt, cash flow and growth the year before.
Borgwarner's latest quarter
Borgwarner, Q3 2026: revenue $3.5B (-3% year over year), operating margin 8.7%, net earnings $221M, operating cash flow $320M. The chart follows the revenue to costs, profit and cash.
Questions
Is Borgwarner being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Borgwarner?
A leveraged buyout at today's price plus 30% ($61.79 a share) would return a loss of about 3% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $35.97 a share (−24% against today's $47.53).
What would a takeover of Borgwarner cost?
Takeovers on record paid a median premium of 32.5% over the share price before the deal (the middle half 20% to 51.8%), according to the 1,437 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Borgwarner would cost about $62.98 a share, $12.9B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.