Filing Flows › Canadian Pacific Kansas City (CP) › Takeover & LBO
Is Canadian Pacific Kansas City (CP) a takeover target?
A leveraged buyout at today's price plus 30% ($122.73 a share) would return about 2% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $65.60 a share (−31% against today's $94.41). At $132.6B it would be larger than any buyout on record (the model flags anything over $60 billion), so this is a thought experiment more than a prospect.
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $122.73 | today's $94.41 plus 30% |
| × shares | 877.6 million | |
| = Equity value | $107.7B | |
| + Debt refinanced | $24.4B | |
| − Cash | $399M | |
| + Other claims | $979M | preferred stock, minority interests |
| = Enterprise value | $132.6B | 16.8× EBITDA of $7.9B |
| Fees | $2.7B | 2% of the price |
| New debt | $43.5B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $91.8B | 68% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $17.0B | $8.4B | $3.3B | $1.2B | $42.3B |
| Year 2 | $18.0B | $8.9B | $3.2B | $1.5B | $40.8B |
| Year 3 | $18.9B | $9.3B | $3.1B | $1.8B | $39.1B |
| Year 4 | $19.6B | $9.7B | $3.0B | $2.0B | $37.0B |
| Year 5 | $20.2B | $10.0B | $2.8B | $2.3B | $34.8B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 13.6× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $135.9B | |
| − Debt left | $34.8B | |
| = Buyer's equity | $101.2B | |
| Money multiple | 1.10× | on $91.8B put in |
| Buyer's yearly return (IRR) | 2.0% |
Price against return
What the buyer makes at other premiums over today's $94.41; the IRR reaches 20% at $65.60 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $103.85 | 6.2% |
| 20% | $113.29 | 3.9% |
| 30% | $122.73 | 2.0% |
| 40% | $132.17 | 0.2% |
| 50% | $141.62 | −1.4% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $16.0B | |
| EBITDA, last 12 months | $7.9B | 49.4% of revenue |
| Depreciation and amortization | $2.1B | |
| Capital spending | $2.8B | |
| Debt | $24.4B | |
| Cash | $399M | |
| Share price | $94.41 | 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 6.5% 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 27% 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 in its sector paid a median premium of 40% over the share price before the deal (the middle half 14.7% to 60.2%), according to the 20 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Canadian Pacific Kansas City would cost about $132.17 a share, $116.0B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 14.7% | $108.29 | $95.0B |
| Median | 40% | $132.17 | $116.0B |
| High end (a quarter paid more) | 60.2% | $151.24 | $132.7B |
Canadian Pacific Kansas City's latest quarter
Canadian Pacific Kansas City, Q3 2026: revenue $4.2B (+15% year over year), operating margin 35.2%, net earnings $916M, operating cash flow $1.6B. The chart follows the revenue to costs, profit and cash.
Questions
Is Canadian Pacific Kansas City being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Canadian Pacific Kansas City?
A leveraged buyout at today's price plus 30% ($122.73 a share) would return about 2% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $65.60 a share (−31% against today's $94.41). At $132.6B it would be larger than any buyout on record (the model flags anything over $60 billion), so this is a thought experiment more than a prospect.
What would a takeover of Canadian Pacific Kansas City cost?
Takeovers in its sector paid a median premium of 40% over the share price before the deal (the middle half 14.7% to 60.2%), according to the 20 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Canadian Pacific Kansas City would cost about $132.17 a share, $116.0B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.