Filing Flows › Costar Group (CSGP) › Takeover & LBO
Is Costar Group (CSGP) a takeover target?
A leveraged buyout at today's price plus 30% ($39.22 a share) would return about 1% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $20.33 a share (−33% against today's $30.17). Historically 2.0% of companies with its figures were bought within a year (0.4× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $39.22 | today's $30.17 plus 30% |
| × shares | 401.9 million | |
| = Equity value | $15.8B | |
| + Debt refinanced | $1.0B | |
| − Cash | $500M | |
| + Other claims | $17.0M | preferred stock, minority interests |
| = Enterprise value | $16.3B | 29.2× EBITDA of $558M |
| Fees | $326M | 2% of the price |
| New debt | $3.1B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $13.5B | 82% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $4.0B | $603M | $235M | $128M | $2.9B |
| Year 2 | $4.2B | $643M | $225M | $162M | $2.8B |
| Year 3 | $4.5B | $679M | $213M | $195M | $2.6B |
| Year 4 | $4.7B | $708M | $198M | $228M | $2.4B |
| Year 5 | $4.8B | $729M | $180M | $258M | $2.1B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 22.7× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $16.5B | |
| − Debt left | $2.1B | |
| = Buyer's equity | $14.4B | |
| Money multiple | 1.06× | on $13.5B put in |
| Buyer's yearly return (IRR) | 1.3% |
Price against return
What the buyer makes at other premiums over today's $30.17; the IRR reaches 20% at $20.33 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $33.19 | 5.4% |
| 20% | $36.20 | 3.2% |
| 30% | $39.22 | 1.3% |
| 40% | $42.24 | −0.5% |
| 50% | $45.26 | −2.1% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $3.7B | |
| EBITDA, last 12 months | $558M | 15.2% of revenue |
| Depreciation and amortization | $346M | |
| Capital spending | $195M | |
| Debt | $1.0B | |
| Cash | $500M | |
| Share price | $30.17 | on Oct 30, 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 8.0% 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 23% 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, Costar Group would cost about $42.24 a share, $17.0B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 14.7% | $34.60 | $13.9B |
| Median | 40% | $42.24 | $17.0B |
| High end (a quarter paid more) | 60.2% | $48.33 | $19.4B |
The odds, from history
Historically 2.0% of companies with its figures were bought within a year (0.4× the average). Its figures put it in decile 1 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.
Costar Group's latest quarter
Costar Group, Q3 2026: revenue $952M (+14% year over year), operating margin 8.8%, net earnings $74.0M, operating cash flow $188M. The chart follows the revenue to costs, profit and cash.
Questions
Is Costar Group being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Costar Group?
A leveraged buyout at today's price plus 30% ($39.22 a share) would return about 1% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $20.33 a share (−33% against today's $30.17).
What would a takeover of Costar Group 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, Costar Group would cost about $42.24 a share, $17.0B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.